Should Forensic Accounting Be Regulated?

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forensic-accountingThe profession of “public accounting” has been regulated by states through the process of issuing CPA licenses. There is one CPA exam taken by candidates across the country, and then each state uses the pass/fail results in their process of certifying accountants. In addition to passing the exam, states generally have education, ethics, and training requirements.

The field of forensic accounting has developed rapidly over the last decade or so, with lots of new professionals practicing forensic accounting. A CPA license is generally not required when providing forensic accounting or fraud investigation services, although many professionals do maintain the CPA credential because it adds a level of credibility to their work. Continue reading

Do Former Law Enforcement Officers Make Better Forensic Accountants?

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Today Brian Willingham of the Diligentia Group has inspired me with his article Do Former Law Enforcement Officers Make Better Private Investigators? While Brian agrees that experience in law enforcement can be helpful to a private investigator, it does not necessarily make that investigator better. The same can be said for forensic accountants and fraud investigators: Law enforcement experience can be helpful, but it is not as important as you might believe.

Brian points us to a video that suggests that: Continue reading

Social Media and Other Information Sources for Litigation

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Who would have thought that a simple internet search could help you win a case in front of a jury? Just 10 years ago that may have sounded far-fetched to many. But those immersed in the world of data mining knew it was possible, even then.

The work of a financial investigator and expert witness is focused on financial documents and numeric evidence. Much of the information in fraud cases or contract litigation is found in private records, such as income tax returns, accounting records, bank statements, and financial statements. Continue reading

Book Review: The Forensic Accounting Deskbook

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The Forensic Accounting Deskbook by Memphis divorce attorney Miles Mason is billed as a guide to financial investigations for family lawyers. This designation sells the book short. The book is an outstanding guide to financial analysis and forensic accounting not only for attorneys, but also for accountants and fraud investigators. Professionals at any level – – from beginner to seasoned expert witness – – can learn much from this book.

The book is exceptionally well organized, with numerous guides and examples that can be used as templates or guides for your current cases. The Forensic Accounting Deskbook begins with an introduction to forensic accounting and engaging the right CPA for your case.  It then moves into accounting for lawyers, which is an excellent overview. Many of the common accounting buzzwords and catch phrases are defined, and knowing what these mean will be invaluable to the attorney. The more you know about the financial issues, the better you can advocate for your client. Continue reading

Expert Witness: Written Report Under Rule 26

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Last year, an important decision was rendered on an appeal involving six expert witnesses. In the case of Walter International Products, Inc. et al v. Walter Mercado Salinas et al, one of the issues on appeal was the district court not allowing Bart Group (one of the plaintiffs) to present testimony from six expert witnesses.

The experts were presented in the following areas: Continue reading

Putting the “Expert” in “Witness”

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Written by Tracy L. Coenen, CPA, CFF

On Balance – The Magazine for Wisconsin CPAs
January/February 2012

Lawyers are constantly on the lookout for financial experts who can help them win cases. Virtually all civil suits involve issues about money, and a certified public accountant is one of the best resources for sorting out the financial details.

As a CPA, you don’t have to focus on litigation work to become an expert witness. As a professional doing income taxes, financial statement audits, benefit plan consulting, or other advisory work, you possess valuable expertise that could help expand your practice. The key is to set yourself up as an expert on a narrow range of issues and market yourself to the right potential clients. Continue reading

Expert Witness Rule Changes Significant

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Written by Tracy L. Coenen, CPA, CFF

Wisconsin Law JournalStarting Dec. 1, there was a significant change to the Federal Rules of Civil Procedure for expert witness reports.

With this change, Rule 26 dictates that the draft reports of experts will no longer be discoverable, and will be protected under the work product doctrine. In addition, communications between the party’s attorney and the expert witness will be protected, except communications that: relate to the expert’s compensation; identify facts or data provided by the attorney and considered by the expert in forming opinions; or identify assumptions provided by the attorney and relied upon by the expert in forming opinions. Continue reading

The Fraud’s In the Figures: Finding Clues in Financial Documents

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SIU Today
By Daniel W. Draz, MS, CFE

Many types of insurance policies require that insureds submit financial documentation in support of insurance underwriting applications and claims submitted for payment. While the financial documentation submitted may be totally legitimate, it’s often hard for investigators to determine one way or another.

With the advent of desktop publishing, it isn’t difficult for documents to be altered, forged or simply created to fit a particular insurance documentation situation. Given a general unfamiliarity with these documents, the complexity of certain types of financial documentation can be intimidating for insurance investigators who don’t work with these forms and figures regularly. While it’s easy to get confused trying to evaluate the financial figures in terms of the insurance issues involved, investigators shouldn’t be discouraged. The numbers may hold important clues to the truth behind insurance applications and claims.

To illustrate what investigators should look for when reviewing financial documentation, this article features an interview with Tracy Coenen of Sequence Inc. Ms. Coenen is a CPA, a Certified Fraud Examiner (CFE), an author and regular industry speaker on the subject of fraud and financial investigations. Continue reading