Forensic accountant

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Forensic accountants are auditors, accountants and experienced investigators of legal and financial documents employed to look for possible suspicions of fraudulent activities within the company; or employed by a company that might just want to prevent fraudulent activity from happening. They also provide services in areas such as accounting, antitrust, breakdown, analysis, assessment, and general consultation. Forensic accountants have also been used in divorce, bankruptcy, insurance claims, personal injury claims, fraudulent claims, construction, royalty audit, and terrorism tracking by investigating financial records. Many forensic accountants work with law enforcement personnel and lawyers during investigations and often appear as expert witnesses during the trial.

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Forensic accounting or forensic accounting has been used since the time of ancient Egypt when Pharaoh had scribes who calculated gold and other assets. These scribes worked in the palace of Pharaoh and were accused of fraud prevention and detection. Their role remained the same until the turn of the 20th century. As accountants they must have knowledge of the latest accounting standards and procedures, proficient in many of the Financial Reporting Systems used, and can provide recommendations that will strengthen internal controls. They also need to have an understanding of the various monetary units that are used internationally because of the various types used in foreign or corporate accounts. As auditors, they should conduct regular financial audits to prevent possible situations that may lead to fraud. As a lawyer, they must know the applicable Federal and State laws and regulations, and must be able to approve or deny suspicion of fraud. They can also be called on to be expert witnesses in court so they must be able to communicate well and at a level that can be understood by individuals without accounting knowledge.

As investigators, they should investigate and collect evidence to be presented in court; can investigate complaints, allegations, and tips of fraud suspicion; should be able to sort, analyze, and compare data to support the investigation; and must have a working relationship with the investigating agency and the prosecutor involved.

Some forensic accountants specialize in forensic analysis which is the procurement and analysis of electronic data to reconstruct, detect, or support fraudulent financial claims. The main steps in forensic analysis are (a) data collection, (b) data preparation, (c) data analysis, and (d) reporting. For example, forensic analysis can be used to review the activity of an employee's purchasing card to assess whether a purchase was transferred or diverted for personal use. Forensic analysis may be used to review invoice events for vendors to identify fictitious vendors, and this technique may also be used by franchisors to detect fraudulent or fraudulent sales reports by franchisees.

When acting as an expert witness in litigation in a Federal Court in the United States, a forensic accountant is required to provide evidence-based testimony or sufficient data and is a product of reliable principles and methods, and they are required to apply sound principles and methods against the facts of the case. When acting as an expert witness in litigation in the UK, a forensic accountant is obliged to provide "objective and unbiased opinions about matters in [their] expertise". For a comparison with French practice, see the study of "Forensic Accountants at Work".

Maps Forensic accountant

Needs information

Forensic accountants must have much access to information about companies they investigate or help with. This information will determine how many people actually make, the business value, if there are fraudulent activities, who commit fraud, everyone involved, how much is taken from the company, where the money goes, and how many can recover. Some obvious information needs consist of financial reports, bank statements, credit reports, and computers. Some of the less obvious information needs consist of address book, email, phone number, spreadsheet, electronic memo, and so on.

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Forensic Investigations/Audit

Forensic accountants must go all the way to become all rounder forensic investigators or auditors who can handle any kind of situation requiring financial or digital forensic skills. Today's white-collar criminals are high tech up to the level of computer use to cheat and commit financial-related crimes in such a way that traditional forensic accountants can not be traced. Sometimes investigations involve searching e-mail to ensure the purpose of an element that must exist for anyone to be punished for fraud. Certified Forensic Investigation Professionals have such training. They are a forensic accountant and a digital forensic expert.

Financial statements

Financial reports are very important for forensic accountants because they have to analyze the information provided on the statement and compare that information with other sources. The balance sheet, income statement, owner's equity statement, and cash flow statement are the four most important financial statements that a forensic accountant sees; however, they also look at business plans and disclosures in footnotes.

The balance sheet shows the financial position of an enterprise at a given point in time. It lists the company's assets, liabilities, and owner's equity while demonstrating the company's resources. The earnings report shows the results of the company's operations over a period of time, the revenue minus the cost for a certain period of time that ends on a specified date. The owner's equity statement, also known as a retained earnings statement or equity statement, reconciles the beginning and end of retained earnings for the period, using information such as net income from other financial statements. The cash flow statements include the source and use of cash and divide them into operating, investing, and financing activities. They evaluate the company's ability to pay bills while indicating whether there is enough money for routine operations. Some other financial documents that need to be checked include general journals, ledgers, sales journals, purchasing journals, cash receipts journal and cash disbursement journals.

Although forensic accountants need to analyze and compare financial statements, most cases of fraudulent activity will not be obvious. The most fraudulent activity will be hidden and manipulated to the point that forensic accountants have to dig deep into the company.

Bank statement

Bank statements are also required to investigate a company. The owner's personal bank statement is required as well as the company bank statement. If the company is the person who wants an investigation done then most likely they suspect an employee. Therefore, bank statements will be required of the individual under investigation. They will show how much money goes in and out of the company. They will also show where the money goes and where it comes from, who the client is, and if any money is transferred to a foreign accountant.

Again, if the owner of the company cheats, the difference will not be obvious; the owner will most likely have a foreign accountant without a trace to them. If evidence from a foreign account can be found then there may also be evidence of what an individual has purchased with the account, when it is opened, how much has been saved, and if there is a valid reason for an individual to have a foreign account open. If the company is based overseas, then that alone is enough reason to have a foreign account. However, if it is an individual personal account and they place an account with a different name (the name of the girl's mother who died 10 years ago) then there is enough reason to believe that someone is trying to hide something.

Credit report

The credit report can show evidence that the bank statement may not, but again, the evidence will not be obvious. Forensic accountants should see if there are large purchases that do not match individual earnings, for example, new vehicles. Credit reports can also reveal that individuals have taken some exotic vacations over the last few years that are beyond their capabilities.

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Education

A person in this field must have at least 2 years experience in auditing or accounting and a Bachelor degree in Accounting or related field. Some forensic accountants are Certified Forensic Accounting Professionals (CFAPs), Certified Forensic Investigations Professionals (CFIPs), Certified Public Accountants (CPAs), Chartered Accountants (CAs), Certified Management Accountants, or Certified Fraud Examiners (CMA/CPA) (Certified Fraud Examiners) CFEs), Certified in Financial Forensics (CFFs), Certified Forensic Accountants (CRFAC), Certified Appraisal Analysts (CVAs), Investigations & Forensic Accountant (IFA), or Chartered Certified Forensic Accountant (CCFA). Some have other professional certifications.

The Certified Forensic Professional Investigation Program for the knowledge and competence of potential researchers in professional forensic investigation skills in a range of subjects include:

1. Criminology & amp; Psychology
2. Principles and Accounting Practices
3. Computers and digital forensics
4. Fraud Audit and Forensic Accounting
5. Criminal Investigation
6. The Study of Fraud and Corruption
7. Investigation Law
8. Accounting for Investigations

Certified Forensic Investigations Professionals have the following expertise:

1. Fraud Prevention and Detection
2. Forensic Investigation
3. Criminal Investigation
4. Design and Implementation of Preventive Control
5. Digital forensics
6. Forensic Accounting
7. Assets that track in Cases of Divorce, Bankruptcy and Money Laundering and
8. The expert watched

Basic Sign In Qualification:

1. Undergraduate degree plus
2. 3 years experience in finance, auditing, investigation, accounting, security and law enforcement, digital forensics or cyber security or
3. a high school diploma with more than 5 years of experience in finance, auditing, investigation, accounting, security and law enforcement, digital forensics or cyber security. Those who have certification such as CPA, ACCA, CA, CFE, or professional qualifications equivalent to an experience of more than 8 years in auditing or investigation may become fully certified through a grandfathering process.

CFIP credentials were first used in 2012.

Certified Forensic Accountant (CRFAC)

The credentialing process of Certified Forensic Accountants offered by the American Board of Forensic Accounting is used to assess the knowledge and competence of Certified Public Accountants (CPAs) in professional forensic accounting services in many areas.

Forensic accountants may be involved in both litigation support (providing assistance in certain cases, particularly with regard to calculations or estimates of economic damage and related issues) and investigative accounting (see illegal activities).

CRFAC covers a broad base of forensic accounting knowledge. The CRFAC credentials first began to be used in 1993. The American Board of Forensic Accounting offers many programs. For effective learning, professionals will need expert training in forensic accounting practice. The American Board of Forensic Accounting offers "Forensic Accounting Overview".

The Association of Certified Forensic Accounting Professionals offers a Certified Forensic Accounting Professional (CFAP) license for auditors, researchers, information security professionals and accountants. Students must pass the foundation and professional exams can appear for CFAP final exams.

Certified Fraud Examiner (CFE)

The Association of Certified Fraud Examiners offers Certified Fraud Examiner (CFE) credentials to members involved in fraud prevention, deterrence, detection and investigation. The candidate's eligibility is based on a point system (representing a combination of formal education, professional certification and relevant work experience) and a minimum of two years of professional anti-fraud experience. To earn CFE credentials, candidates must pass a four-part exam and adhere to a professional code of ethics.

Forensic accounting terms and fraud checks are often used interchangeably, but they are not the same discipline. Forensic accounting focuses on litigation support and covers both fraud and non-fraud situations (eg economic damage, personal injury, family law, etc.). The fraud examination concerns itself exclusively with fraud-related matters and includes prevention, prevention, detection and fraud investigation.

CFE credentials are recognized by partner organizations that lead the global struggle against fraud and include, inter alia, the Federal Bureau of Investigation, the Securities and Exchange Commission, the Internal Revenue Service, the Ontario Provincial Police, the City Police of London and the City of Toronto General Auditor Office.

Certified in Financial Forensics (CFF)

The American Institute of Certified Public Accountants has a credential of subject matter for forensic accountants. Certified Credentials in Financial Forensics ("CFF"). "CFF credentials are awarded exclusively to CPAs that demonstrate sufficient expertise in forensic accounting through their knowledge, skills and experience.CFF includes fundamental and specialized forensic accounting skills applied by CPA practitioners in various areas of service, including bankruptcy and bankruptcy. computer forensic analysis, family law, judgment, fraud prevention, detection, and response, misrepresentation of financial statements, and calculations of economic damage. "

The average salary for a forensic accountant in the US is about $ 74,000.00. A forensic accountant in New York can reach $ 102,655.00 while a forensic accountant in Orlando usually only earns $ 56,071.00.

Forensic accountants must be able to work independently and can travel at least 10-15% of the time. Some forensic accountants who act as consultants are not paid for salaries and are somewhat contracted to perform specific tasks for a company. Decisions are made between the organization and the accountant about what to pay if the work is done in a certain amount of time and the accountant is paid when it is done. These contracts can range from several thousand to several million depending on the time required and special skills, if any, that are required.

Certified Valuation Analyst (CVA)

Certified Appraisal Analyst (CVA) is an appointment issued by the National Association of Certified Valuation Analysts (NACVA) to accounting professionals who have the knowledge and expertise of business valuation standards. The requirements for the appointment of a CVA include holding an active, valid, and non-prescribed CPA license or holding a business degree (ie, in management, economics, finance, marketing, accounting, or other business fields) and/or MBA (business administration master) or business degree which is higher than an accredited college or university and two or more years of full-time or equivalent experience in business valuations and related disciplines for non-CPAs. In addition to these requirements, CVA applicants must complete and pass a prescribed training course and exam and complete a case study or submit an actual and sanitized market value report, prepared over the past 12 months, for peer review.

The NACVA recertification process is designed to ensure that credential holders follow changes in the evolving field of assessment and that they continue to adhere to industry's high standards. Recertification is required every three years.

CVAs are used to conduct business valuations in a variety of examples. This may include matters relating to mergers and acquisitions, buy/sell agreements, determination of damages in terms of third party liability, difference in shareholder action, business dispute, divorce settlement, real and succession/exit plan, initial public offering, dispute partners, public domain issues and fraud and combustion defenses involving insurance values. Chartered Certified Forensic Accountant (CCFA)

Chartered Certified Forensic Accountant, the appointment of CCFA is the appointment of global forensic accounting provided by the International Institute of Certified Forensic Accountants, Inc. (IICFA). For granted with CCFA designation, a person must pass all four (4) CCFA qualification examination levels and must earn two years post-qualification or professional experience with a reputable forensic accounting firm. Eligible students must undergo practical forensic accounting workshops for three days prior to graduation and membership acceptance.

The CCFA must comply with the CPE of the Association. To maintain the CCFA designation and be in a good position, 30 hours CPE per year is mandatory.

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References

• Benny K B Kwok, Forensic Accounting editions 1 and 2 published by LexisNexis 2002 and 2008
• "International Institute of Certified Forensic Accountants, Inc. - IICFA". iicfaglobal.com .

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External links

• Certified Fraud Tester Association
• Professional Association of Certified Forensic Accounting
• International Institute of Certified Forensic Accountants, Inc. IICFA
• International Institute of Certified Forensic Investigation Professionals, IICFIP
• Certified in Financial Forensics
• Hong Kong Institute of Certified Public Accountants HKICPA
• Forensic Accounting Certification
• HKICPA training in forensic accounting
• Institute of Chartered Accountants in England and Wales ICAEW
• ICAEW forensics group

Source of the article : Wikipedia