Cardiff, UK - What is the role of forensic accountants?

According to statistics from the Association of Certified Fraud Examiners, 5% of global corporate revenue is lost to fraud each year, amounting to approximately 3.8 billion pounds. With the increasing proliferation of technical resources around the world, it is becoming more important to get to the bottom of crimes through investigations to bring the perpetrators to justice.

However, these cases are often very complex to investigate and then provide the right and enough financial evidence in court. That is where forensic accounting comes in.

So, what is a forensic accountant, and what role do they play? Here is all you need to know about forensic accountants.

What is forensic accounting?

In definition, the word “forensic” refers or denotes to the application of scientific methods and techniques to the investigation of crime and evidence that can be used in court. Forensic accounting is a profession that utilises auditing, accounting, and investigative skills to aid in legal proceedings of an economic transaction to establish accountability.

How does forensic accounting differ from traditional accounting?

Unlike traditional certified public accounting, forensic accounting provides financial data or accounting analysis that an organisation can use to resolve internal disputes. A forensic auditor has the training to investigate financial disputes, accounting fraud or financial misconduct by analysing, interpreting, and summarising complex data in a way that is easy to understand and is backed by facts and figures.

The role of forensic accountants’ expertise in an investigation dictates that they must have the skills to gather evidence of financial crimes, question third-party witnesses, and appear in court as expert witnesses. These are all responsibilities that a typical accountant won’t be able to fulfil.

###

What is the role of a forensic accountant?

The role of forensic accountants will mainly include the following:

Crime investigation

Financial fraud doesn’t often occur out of the blue. Typically, it requires and shows a transaction that the accounting will record in some way. When there is suspicion of fraud in an organisation, a forensic accountant’s role is to find out the truth by analysing and reviewing evidence, interviewing people and making a conclusion from the evidence and providing it to the relevant parties. Thanks to their broad knowledge of financial forensics, the accountants will comb through the financial records and other suitable documents to find out the truth.

They do this by tracing all related transactions to their journal entries to ensure that the needed information is available for review. With all this in place, a certified fraud examiner can identify any missing links and point out fraudulent transactions.

Report preparation

Once forensic accountants conclude their investigation using their accounting and investigative techniques, they are required to prepare a report that can be admissible in court. This means summarising all the complex data collected (financial documents) in a simple manner that the relevant financial institutions can understand.

You can read our full and informative article here.

If you are looking for an expert forensic accountant we can help. Contact us today at 02920 777 75.