Each year, financial crimes cost US citizens billions of dollars, eroding trust in commercial institutions and impacting people’s economic well-being. Forensic accounting is the study of a business’s financial records in order to identify illegal or unethical behavior by internal and external forces.

What is a Forensic Accountant?

Forensic accountants specialize in the examination of accounting data for litigation or law enforcement purposes. They use their accounting, auditing, and investigative skills to gather, analyze, and interpret financial information and bookkeeping records to pinpoint areas of criminal activity.
The three main forensic accounting areas are:

1. Criminal - Forensic accountants investigate fraud, embezzlement, employee theft, and other so-called white-collar crimes, tracing funds and detailing evaluations on financial delays.
2. Litigation - Forensic accounting is often needed when a legal matter involves financial arguments that must be decided in a court of law.
3. Insurance - Forensic accountants are CPAs who are trained to quantify a case’s economic damages. This is particularly helpful in complex matters with multiple facets of accounting.

Many industries benefit from using a forensic accountant’s services, including:

• Government
• Finance, including banks, brokerages, and financial consulting
• Insurance
• Law firms
• Law enforcement
• Risk management and corporate security

Forensic accountants sometimes testify as expert witnesses, covering issues such as fraud prevention and business valuations.

The Benefits of Outsourcing Forensic Account Services

Many companies, especially those that use a bookkeeper or don’t have a full-time staff accountant, struggle to manage modern accounting needs. Outsourcing forensic accounting services is a great solution that can help businesses in multiple ways:

1. Security - Outsourcing ensures objective and unbiased investigations, particularly in cases where the fraud is suspected of being internal.
2. Lowers compliance risk - In-house accountants tend to have their hands full with daily tasks. Taking on a forensic role requires specialized knowledge of tax, accounting, and regulatory requirements. An outsourced firm helps protect your business against legal judgments, fines, and penalties.
3. Access to expertise and technology - Smaller businesses with limited resources find it challenging to recruit and retain forensic accountants. Outsourcing provides access to highly experienced professionals who are knowledgeable in all the latest accounting, tax, and other technology tools.

Lastly, it’s estimated that businesses lose up to five percent of revenue to employee fraud alone every year, and over ten percent of it occurs inside the accounting department. Using outsourced forensic accountants can significantly reduce your risk of fraud by company insiders.

Forensic Accounting is a Growing Profession

The US Bureau of Labor Statistics projects accounting jobs, including in forensic accounting, will grow at a rate of nearly 126,000 new jobs each year through 2029. Whether you’re looking for forensic accounting positions in the Las Vegas area or need one or more forensic accountants for your business, Taurean Consulting Group can help. Contact us today to learn more.