14 Jan

Documents Needed to Investigate Business Interests in a Divorce

When a spouse owns a business, it can create some of the most complicated financial issues in a divorce. It is extremely important to dive into the financial records of the business in order to value it and to determine where the money is REALLY going. Tracy Coenen and Miles Mason discuss what documents a forensic accountant needs to evaluate the business.

21 Nov

Why Audits Don’t Find Fraud

This video is a little longer than usual. Tracy Coenen talks about the reasons why traditional financial statement audits don’t find fraud. It is very rare for fraud to be uncovered during the year-end audit, but stakeholders often rely on audits to do just that.

Tracy walks through these 9 common reasons why audits are not effective at detecting the fraud. Watch the video for the details of each.

  • Reliance on internal controls
  • Doing predictable audit tests
  • Using sampling of transactions
  • Employees working around scope and materiality
  • Inexperienced auditors
  • Dynamic business environment
  • Inadequate follow-up by auditors
  • Looking for a needle in a haystack
  • Use of estimates by management

14 Nov

Finding Fraud Clues in the Notes to Financial Statements

The notes to financial statements are often lengthy and boring. But they can provide very important information about a company.  On the most basic level, they provide details behind the company’s numbers. But they can also provide clues to fraud or other irregularities that may be occurring. Tracy gives a brief overview and a few examples of things you might find in these notes.

08 Oct

Doing Criminal Defense Work

Defendants in criminal cases such as tax fraud, money laundering, or embezzlement often need forensic accountants to help evaluate complex financial situations. Should you provide expert witness services to criminal defendants? Tracy discusses the work and some of the issues that should be considered.

30 Aug

Qualifying as an Expert Witness

You are only an expert if the judge says you’re an expert. No matter how many times you may have testified in court as an expert witness, each time you must prove all over again that you’re qualified to provide expert testimony.

In this video, Tracy Coenen talks about how she presents herself to the court as a forensic accountant so that she will be qualified to provide expert testimony. It is a combination of education, credentials, and experience.

14 Aug

Net Worth Method of Proof for Unreported Income

When an IRS auditor or criminal investigator suspects that a taxpayer has unreported sources of income, he or she looks for ways to calculate that unreported income. One way is the net worth method of proof.

Forensic accountants and fraud investigators can use the same method to calculate unreported income in other types of cases, such as divorce. In this video, Tracy describes how the calculation is done and how the results may be used.

08 Aug

Behavior of Upper Level Executives Who Commit Fraud

A while back we talked about behavioral red flags of fraud, which are the signs that someone might be involved in a fraud at work. Some of the most common red flags are living a lifestyle that exceeds a person’s earnings and unusual attitudes on the job (being combative, possessive of their work, etc.)

The same red flags don’t necessarily apply to upper-level executives, or they’re just not as easy to spot. In this video, Tracy talks about some of the warning signs we might see with top executives who are committing fraud. Most commonly, we see a higher level of greed and arrogance when committing fraud (which, coincidentally, may lead to the person’s downfall).