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Forensic Accountant Career Guide

How to Become a Forensic Accountant

Forensic accounting combines a love of numbers with strong investigative skills to trace funds, identify and recover assets, and perform reviews. For these reasons, forensic accountants are often brought in as expert witnesses in legal proceedings, especially those related to fraud (including identity theft) or embezzlement.

This career might be for you if you enjoy working with numbers and diving into complex financial and business matters. Here, we’ll take a look at everything you need to know about the field.

Accountant on computer working on resume

What Is a Forensic Accountant?

The word “forensic” means investigating using scientific methods and techniques. Whether they work for an insurance company, bank, police department, government agency, or public accounting firm, a forensic accountant’s role is to identify suspicious financial activity and determine its cause. 

Forensic accountants often work in either litigation or investigation to help identify financial misconduct and bring the truth to light. It’s an important combination of accounting, auditing, and investigative skills to ensure best financial practices are being observed by people and organizations. 

What Does a Forensic Accountant Do?

Forensic accountants use their knowledge of tax laws and financial accounting practices to perform daily job duties such as:

  • Conducting investigations — Independently researching and auditing internal and external financial documents.
  • Assessing losses — Based on your findings, you’ll need to determine how much money the company has lost to fraud.
  • Writing reports — These reports summarize your findings and help companies better understand what their next steps should be.
  • Determining potential damage awards — If you catch the people who (performed) fraud, you’ll need to determine how much money the company is owed, including damages.
  • Testifying in the courtroom — Based on your accounting knowledge and experience with the case, you can bring your expert testimony into the courtroom.
  • Working with law enforcement — Because most forensic accountants deal with crimes, whether internal or external, they work closely with law enforcement during their investigations.

Where Do Forensic Accountants Work?

Forensic accountants can work in a wide variety of roles, including:

  • Forensic accounting divisions in public accounting firms — Many accounting firms have forensic accounting divisions that specialize in identifying and uncovering fraud.
  • Consulting firms  — Firms that specialize in risk consulting and forensic accounting services.
  • Law firms — Some law firms specialize in uncovering fraud, so they maintain forensic accountants on staff who act as expert witnesses in trials.
  • Law enforcement agencies  — Law enforcement agencies around the country, including the FBI, need services provided by forensic accountants.
  • Insurance companies — Here, forensic accountants act as an intermediary between the insurance company and the insured to help quantify the economic damage of each case and ensure claims are settled accurately.
  • Government organizations — In addition to the FBI, forensic accountants can work with other government agencies like the Central Intelligence Agency (CIA) and Internal Revenue Service (IRS).
  • Financial institutions — Many financial institutions need the services of a forensic accountant to help uncover instances of fraud.

What Education Does a Forensic Accountant Need?

Most entry-level forensic accounting positions require at least a bachelor’s degree in accounting (forensic or otherwise) or finance. In a bachelor’s degree program you will learn critical accounting skills such as financial reporting, auditing, regulatory measures, and more. These are vital in helping accountants understand what they are looking for when investigating misconduct.

Additionally after pursuing a bachelor’s degree, a master’s degree in accounting can be an important next step. Many forensic accountants are also CPAs, or certified public accountants with special licensure. This licensure allows them additional opportunities to handle financial reports and file claims with the government. In most states you’ll need a master’s degree in order to be able to become a CPA. In a master’s degree program you will learn advanced accounting skills which can aid you on your path to a career in forensic accounting.

Accounting – B.S. Business Administration

Have a knack for numbers or fine-tuning finances?...

Have a knack for numbers or fine-tuning finances?...

Have a knack for numbers or fine-tuning finances?

  • Time: 70% of graduates finish within 41 months.
  • Tuition and fees: $3,720 per 6-month term.

Some careers and jobs this business degree will prepare you for:

  • Accounting manager
  • Financial director
  • Vice president of finance and operations
  • Chief financial officer
  • Forensic accountant

Take your first step toward CPA certification and learn how to use GAAP, ledgers, and journals.

Accounting – M.S.

Become better qualified to pursue a greater variety of public...

Become better qualified to pursue a greater...

Become better qualified to pursue a greater variety of public and private accounting positions:

  • Time: 70% of grads finish within 23 months.
  • Tuition and fees: $4,675 per 6-month term.

Some careers and jobs this business degree will prepare you for:

  • Accountant
  • Accounting manager
  • Internal audit manager
  • Senior accountant
  • Other specialized finance roles

This MAcc program is designed to prepare you for the CPA exam and also the CMA or CIA exams.


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What Skills Does a Forensic Accountant Need?

Some of the must-have skills for a forensic accountant include:

  • Computer Skills — The role of technology is only increasing, which is why forensic accountants need to have strong technology skills;
  • Detail-Oriented — There are many moving parts to any investigation, so forensic accountants must have an eye for detail;
  • Financial Analysis — Analyzing financial documents during investigations;
  • Auditing — An inspection of an organization's accounts;
  • Communication  — Communication skills are highly beneficial to forensic accountants, who frequently interview witnesses and provide expert testimony during trials; 
  • Organization — Forensic accountants often juggle multiple investigations and dozens of different documents, and they need to remain organized throughout the process;
  • Creative Thinking and Problem-Solving — No two investigations are the same, so it’s important to stay adaptable as problems arise.

How Much Does a Forensic Accountant Make?

$73,560

According to the U.S. Bureau of Labor Statistics (BLS), the median pay for accountants and auditors, including forensic accountants, was $73,560 — or about $35.37 per hour — in May 2020. These numbers included a low of $45,220 and a high of $128,680.

It’s important to emphasize that these numbers can vary widely depending on the level of education (including relevant certifications), years of experience, and location.

What Is the Projected Job Growth?

4%

The BLS reports that the need for accountants (including forensic) will grow at a 4% rate between 2019 and 2029, which is as fast as average.

In general, employment growth for accountants and auditors is expected to closely align with the economy’s overall health. And as the economy continues to grow, more workers in the field should be needed.

The BLS points out factors behind this demand, such as “globalization, a growing economy, and a complex tax and regulatory environment.”

Does a Forensic Accountant Need Certifications?

Yes

Although certifications aren’t necessarily required to work as a forensic accountant, they can help boost your know-how and make you more competitive as a job candidate. Common professional certifications include: 

-Certified Fraud Examiners (CFE) — According to the Association of Certified Fraud Examiners, the CFE exam is designed to test your expertise in four main areas: financial transactions and fraud schemes, law, investigation, and fraud prevention and deterrence.

-Certified Public Accountants (CPA) — Full licensure requirements vary by state, but the CPA designation is given by the American Institute of Certified Public Accountants (AICPA) to those who complete 150 hours of education and pass the Uniform CPA Exam.

-Chartered Accountants (CA) — This is an international designation similar to the CPA designation in the U.S.

 

 

Interested in Becoming a Forensic Accountant?

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