Meaning & Functions of Forensic Accountant
This Article on Forensic Accounting will help you to learn:
- Meaning & Definition of Forensic Accountant
- What do Forensic Accountants Do
- Why Forensic Accountant is necessary
- Role of Forensic Accountant in business
In general term a Forensic Accountant could be defined as the person who seeks for the truths and evidence for proving those truths. A forensic accountant is one of the most significant parts in fraud investigation. A forensic accountant has to perform certain responsibilities such as,
- Investigate and analyze the financial documents,
- Communicate the findings acquired from the investigation, and
- Coordinate and assists with further investigation, including appearing in court as an expert witness.
A forensic accountant has to possess some skills to perform the responsibilities properly. For example, pure methodological accounting and financial skills and knowledge, good communications skills, creativity in writing report, independency in providing report and so on. Basically Forensic accountant does not appear on the first scene of any crime.
Forensic accountants generally face or appear on the crime scene after the appearance of fraud auditors. But it does not mean that their contribution in fraud investigation do not important or remarkable. Forensic accountants play a vital role in fraud investigation. For example, translate those financial transactions and numerical data into general terms which are complex to make it easily understandable to ordinary laypersons. Because when the fraud comes to trial, the jury will be made up of ordinary laypersons. The forensic accountants are experienced and trained in several areas which make them expert and skilled. But forensic accountants are not trained only in the area of financial accounting and auditing. They also specialist in other areas such as, criminal investigation, taking interview with people, report writing or providing report to the court, and testifying the report as expert witnesses.
Forensic accountants must have to own the capacity of excellent communication and professionalism in conducting with people. The participation of the forensic accountant is generally reactive than other accountants or auditors which differentiate a forensic accountant from fraud auditors. Fraud auditors have the tendency to enthusiastically participate in the prevention and revealing process of fraud in a corporate or in any regulatory environment. Forensic accountants are contracted to respond to those complaints which arise in criminal facts and matters. For example, statements of claim arise in civil litigation, and rumors and inquiries arise in the investigations of any corporate or business.
During the investigation of the forensic accountant will have some findings and these findings must influence the freedom or a financial award or loss of an individual and/or a company. According to the ACFE this person is termed as a fraud examiner. The forensic accountants draw attention on the various resources in order to acquire relevant and significant financial evidence .Then they will interpret and present this evidence in a helpful manner that will assist both parties. if possible, then forensic accounting should allow two parties to more rapidly and professionally resolve the complaint, statement of claim, rumor, or any inquiry, or at least reduce the financial element as an area of enduring debate. The impartiality and independence of the forensic auditor are considered as the supreme quality of a forensic accountant for these owing these purposes.