Forensic accounting is a specific branch of accountancy which deals in financial legalities. Whereas a standard accountant will work with taxes and expenses, forensic accountants often focus on fraud, financial crimes and conflict between parties.
Accountants who specialise in this area are often needed in order to make sense of a complex financial system. Whether it be multiple bank accounts in different countries or multiple businesses, fraud has become extremely sophisticated and expertise is often a requirement.
Fraud may be the most common reason to call on a forensic accountant but there are many instances in which you may need their help.
Investigation
As the name suggests, one of the main jobs of a forensic accountant is investigation. Whenever some sort of corruption is found, this will usually lead to a thorough investigation into the financial history of an individual, group of individuals or business. This type of investigation would be vital in collecting evidence that could then be used in court. This type of deep dive is often required in order to identify a motive and potentially implicate other parties. Whether they’re hired privately or are working within law enforcement or government, investigation by forensic accountants is important in preventing and identifying fraud.
Presentation
One of the main reasons why forensic accountants are required is because they have the ability to present a complex idea, such as fraud or money laundering in a relatively simple manner. When it comes to investigating potential financial crimes, many of the parties involved often need this presentation in order to fully understand the situation. Whether it’s the victim, business owner, police or judge- having an expert on hand is invaluable. This readily available expertise is paramount to not only identifying fraud and other crimes but also bringing the perpetrators to justice.
Audits
Although forensic accountants will often be employed to investigate a specific issue, there are times when businesses or organisations will utilise them proactively. For example, a company asking an accountant to look at the business and investigate whether there is any potential fraud. This is almost a housekeeping exercise, in which business owners will attempt to halt any potential issues, before they become a larger problem.
Another aspect of employing a forensic accountant to audit your business is utilising their expertise to find any flaws in the system. Similar to how a secret shopper would be able to point out potential issues within a retail setting, a forensic accountant could showcase any financial vulnerabilities within a business. This will then allow company owners to make the much-needed adjustments, protecting the overall business.
Marital Disputes
It’s fair to point out that forensic accountancy isn’t always dealing with large scale fraud or criminal behaviour. There is a much more domestic need for this type of expertise, in the form of marital disputes. For many couples, separating is relatively simple, with a straightforward splitting of assets. However, there are instances in which assets owned by one or both of the parties in question are complicated and therefore the help of an accountant is required. For example, if one or both of the parties own separate properties, businesses or trusts. There are also times when expert help is required in calculating child support.
The experts at Taxation Investigation provide a comprehensive, reliable forensic accountancy service. Their team of experts can help with a wide range of issues, including fraud, breach of contract, valuations, IP rights, personal injury and divorce, just to name a few. Don’t’ hesitate to get in touch with Taxation Investigation for further information on this service.