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Forensic accountants are specialist accountants that assist and oversee a variety of different cases and investigations thanks to their wide range of expertise and knowledge.
The following blog will answer ‘what is a forensic accounting firm’, discuss what the duties of a forensic accountant are, as well as who hires forensic accountants and for what purpose.
What is a Forensic Accounting Firm?
A forensic accounting firm is a neutral third party that looks into suspected cases of financial wrongdoing. They’re often called on to provide expert testimony during legal proceedings, highlighting any discrepancies in terms of spending or “hiding” funds. The job of a firm is to simply uncover the facts— they have no association with either side during a dispute.
A highly specialised field within the wider accounting industry, forensic accounting firms will instruct a dedicated forensic accountant to assist in a variety of complicated financial cases, including:
- Commercial disputes
- Divorce/matrimonial disputes
- Financial crime
- Financial losses
- Forensic insolvency
The Duties of a Forensic Accountant
The duties of a forensic accountant are to combine accounting, auditing, and investigation skills to provide an all-encompassing, complete package. They undertake meticulous investigations to uncover potential irregularities, locate and recover missing funds, analyse financial documents for mistakes/misrepresentation, and then provide their findings and insights in a clear, easy to understand manner.
It’s commonly thought that forensic accountants work specifically in criminal investigations, but this isn’t correct. Forensic accountants can also work with businesses and individuals on a variety of potential cases. Criminal cases and investigations only represent a portion of the duties of a forensic accountant.
The duties of a forensic accountant can also include preventative measures. Businesses will hire a forensic accountant with the aim of assessing their finances, to look at their operation and to minimise the potential for any serious financial issues in the future.
Using their vast and unique set of skills, the duties of a forensic accountant include (but are not limited to):
- Investigating and proving financial crime
- Investigating and proving financial loss
- Performing detailed investigations into business/personal accounts
- Provide expert evidence in a court setting
- Identify/Trace any hidden assets
- Gather intelligence
- Analyse vital documentation
- Carry out due diligence reviews
- Defend confiscation orders
- Value shares/businesses
The role of a forensic accountant is a varied one; the job differs from day to day. This variety requires all forensic accountants to be flexible and to maintain a keen eye on all aspects of the financial crime industry. This ensures that they remain on top of any new developments and insights within the industry.
Who Would Hire a Forensic Accountant?
Due to the diversity of skills and experiences held by forensic accountants, they can be utilised by individuals, businesses and various forms of lawyers/solicitors to help with all manner of issues. This includes:
Criminal Defence Solicitors
Financial crime cases such as financial fraud or confiscation order proceedings often wind up being complex and expansive — such cases usually come with large amounts of information to trawl through to uncover vital evidence. This process is very time-consuming, and for an untrained solicitor, it’s much like looking for a needle in a haystack.
A forensic accountant will have vast experience in analysing large amounts of important data in a short amount of time. They will also be able to draw upon this experience to streamline the process, to uncover clear and relevant data in order to assist with your financial crime/POCA cases more efficiently and accurately.
Forensic accountants can also assist in the presentation of evidence. They are trained to present their findings in a clear and concise manner, ensuring that everybody in the courtroom; from judge to jury will better understand the intricacies of your case. This can increase your chances of achieving the preferred result.
When it comes to delicate cases regarding subjects like divorce and matrimonial disputes, it can be important to have an expert on hand who has seen it all and knows how to act in any situation. A forensic accountant is capable of acting on behalf of either a single party , or both sides (Single Joint Expert).
A family lawyer can instruct a forensic accountant to assist with any of the following and more:
- Providing valuations of assets
- Tracing/identifying key assets
- Act as an expert witness in court
In business, any form of dispute can be an incredibly complex situation. Instructing a specialist forensic accountant will guarantee an in-depth review being undertaken that can get to the bottom of your situation. This review will provide a detailed analysis of any liabilities, quantify damages, etc.
However, potentially the most important reason a business owner should instruct a forensic accountant though is for the added personal factor. Forensic accountants are on hand to attempt to take the stress out of difficult situations. They will also give their opinions on any potential disputes, to inform you if they believe it has any merits and to discuss the next steps.
Insurers and Loss Adjustors
Forensic accountants can be pivotal in assisting in a financial loss/ business interruption claim. The most time-consuming aspect of any business interruption claim is generally wading through the vast amounts of evidence from all sides — this is directly in line with the skill set of a forensic accountant. Not only that, the technical and data analysis skills of these specialists can be crucial.
Your forensic accountant will be able to assist you with your claim from beginning to end, providing you with informed opinions at each juncture to ensure the best possible result is achieved. This all-encompassing knowledge and service means that instructing a forensic accountant as early as possible is recommended for any insurers or loss adjusters working on a business interruption case, no matter how big or small.
Some cases of business insolvency can be resolved amicably without the need for a forensic accountant. However, cases of particularly contentious insolvency can be highly complicated and stressful for all parties involved.
Insolvency practitioners will often consult a forensic accountant for complex/contentious insolvency cases. The accountants will perform an in-depth investigation, leaving no stone unturned in their attempt to help resolve the situation.
Even attempting to rectify a case of particularly conscientious insolvency without a forensic accountant can be a huge gamble for any insolvency practitioner. With no room for error, and the potential for serious ramifications, instructing a forensic accountant is highly recommended.
Personal Injury Solicitors
When dealing with a personal injury claim, it is vital to have the best possible team on hand. A specialist forensic accountant can work in tandem with a personal injury solicitor to investigate the circumstances behind an injury claim, quantify the claimant’s losses, and ultimately provide their expert opinions throughout the case.
In cases where the injury is deemed severe and may cause significant lifelong changes to the claimant and their family, a forensic accountant is vital.
For a case of this magnitude, where its lasting impact will likely be felt for the years to come, it is important that all avenues are explored and all calculations are undertaken as accurately as possible.
Why Work with Inquesta on Forensic Accounting Cases
If you consider that you might be somebody who hires forensic accountants, it’s important to find the right team for you.
Inquesta has been in the business of providing our clients with a dedicated, all-encompassing forensic accounting service for decades. No matter what it is you need assistance with, from fraud to compensation; commercial dispute to matrimonial dispute, our team of forensic accountants can help.
Our team is trained to act methodically in everything they do. We also understand that all of our clients and their cases are unique, which is why we offer a completely bespoke service.