Forensic Accounting

Forensic Accounting in Practice

Dr. Phillips

Business 508 Contemporary Business

October 17th 2013

Introduction

Forensic accountants are a unique set of individuals that uses a blend of education and experience to apply accounting, financial analysis and investigative skills to assist businesses in understanding the root cause of their financial issues. Forensic accountants not only work for businesses, but they may also be retained by attorneys and creditors to assist in legal matters. In addition, they are a part of investigations and at times appear in the court as a witness in fraud cases. Forensic accountants also review financial statements of the company and help them prevent fraudulent cases by assisting with their accounts.

Skills of a Forensic Accountant and their Application:

A study conducted by the American Institute of Certified Public Accountants asked a group of accountants, academic advisors, and CPA’s to list what they themselves believed to be the top five skills required for a forensic accountant. The list consisted of sixteen different options, but the number one skill required by all three groups was the ability to be analytical. “The need to be analytical in a forensic accounting engagement may be the initial and most important overall characteristic and core skill, without which other traits and abilities would be difficult to develop.” (AICPA, 2012)

A good forensic accountant is not good just because he or she is good with numbers. A forensic accountant should possess the skills of implementing his or her own knowledge to its best and find accurate results, under the GAAP. The five major skills required by a forensic accountant are as follows: An accountant should be analytical. A forensic accountant needs to possess the analytical skills necessary as they need to analyze an accounting problem or issue to take corrective steps towards resolving it. A forensic accountant can only give solutions and be a witness to the financial...