Accounting - How To Become A Forensic Accountant
How To Become A Forensic Accountant: Degree & Career Guide
Crime is all around us. And considering the importance of finances in our lives and the fact that the world revolves around money in terms of survival, criminals have delved deep and become more creative about the financial crimes that they commit.
Gone are the days of someone robbing you and taking your wallet or purse from you. Now, cyber financial crimes have become increasingly common. Since money is now seen in a representational form in our bank accounts, criminals have ventured into investment fraud. But the number of financial crimes that exist is shocking.
Given this rise and constant interest in the theft of finances, there has probably always been a demand for law and legal professionals to intersect with financial professionals. It is at this intersection where forensic accounting exists.
To become a forensic accountant, you would need to first obtain your bachelor's degree and choose subjects and courses that are directly related to the field of accounting. Next, you would need to consider pursuing your master's degree. Thereafter, you would seek employment and earn a certification.
Let us take a closer look at what a forensic accountant is, what the job entails, and the detailed steps that you would need to pursue this particular role.
What Is A Forensic Accountant?
Forensic accountants are the detectives of the finance world. They combine their knowledge of forensics, investigation, and law enforcement with the knowledge and expertise in understanding, compiling, and interpreting financial data, and they work on financial crime cases to identify and reprimand those who commit any form of financial fraud.
This specific type of accountant may hold a role in two different spheres, either in law enforcement or within the Federal Bureau of Investigation (FBI), or they may work somewhat as private investigators who are part of a corporation, an accounting firm, or as an independent practitioner who consults and provides insights and assistance into an array of financial and white-collar crimes.
Given this unique role, forensic accountants are required to serve a dual purpose, working in law enforcement, as well as working with numbers. It goes without saying that the skills and expertise that are possessed by forensic accountants are phenomenal.
By using scientific methods and techniques and by closely analyzing the numbers that they are presented with, forensic accountants will work tirelessly in not only pinpointing any financial discrepancies that exist, but they will also work toward figuring out why these discrepancies exist in the first place, and who is likely responsible for these discrepancies.
They work in investigating general fraud and Ponzi schemes where they may be hired by victims who are suspicious of their investors, they may be hired by large corporations to identify if any theft, of money or assets, has occurred, and they may assess the financial records and statements of any individual or corporation that is under suspicion by the IRS for any tax-related fraud.
Any findings that a forensic accountant uncovers can be used in a court of law.
What Does A Forensic Accountant Do?
Forensic accountants prove quite clearly that the numbers do not lie. Their duties may vary day-to-day in that they may be working with different clients each day or in that they may be providing testimony in court, but for the most part, an accountant will be investigating financial records to identify any fraudulent activities, tax evasion, embezzlement, money laundering, and misleading shareholders.
They will identify and financial records, evidence, or information that has been attempted to be concealed, they will work with law enforcement teams and private corporations in taking matters further and even executing arrests, They will collect evidence, and they will assess financial records through a variety of means, be it interviews or assessing physical evidence in the form of reports and bank statements.
They will also work toward assessing the value of assets, they will conduct risk management and reduction strategies, will delve deep into potential mergers and business acquisitions to ensure that their clients are not getting involved in any unsavory dealings unbeknown to them, will conduct bankruptcy proceedings, and they draft detailed reports of all their findings.
Types Of Forensic Accountants
Within forensic accounting, you could choose to pursue any number of subfields. First, you could work as a fraud examiner which is where you will examine financials and reports and draft the same reports to assess if any fraudulent activity is taking place in an organization.
You can work with the legal aspect of fraud which entails close collaboration with law enforcement to bring the criminals to justice, or you could work in fraud prevention which entails devising accurate risk management plans and internal and external controls to effectively deter criminals. This role executes preventative duties but is just as important as an individual who actively pursues fraud cases.
You may also choose to stick closer to the investigative side of operations and get directly involved in a case by predominantly conducting interviews.
Steps To Become A Bookkeeper
Step One: Choose Your Path
Before you even go into your undergraduate degree program, you would need to know, to some extent, which field of forensic accounting you are hoping to get into. Do you just want to be a forensic accountant that investigates fraud, do you want to be a fraud examiner collecting fraud-related data for analysis, do you want to become an internal auditor where you deter fraud and oversee risk management processes for a particular company, or would you prefer to be a fraud and forensic accounting consultant where you apply your skills to any number of different clients?
Step Two: Obtain Your Bachelor's Degree
Next, you would need to enroll in a degree program whereby you will actively pursue forensic-related coursework that will aid you in your progress toward becoming a forensic accountant.
Some of the courses you may be expected to pursue and elective courses that may assist you in your desired path are management accounting, business ethics, taxation, principles of accounting, and auditing.
Step Three: Become A Certified Public Accountant
Before you can practice as a forensic accountant, you need to become a certified public accountant (CPA). You can obtain your CPA certificate from the American Institute of Certified Public Accountants. During this examination, your knowledge, and skills in different fields of accounting, and should you prove to be successful, you will obtain your certification.
Step Four: Obtain A Graduate Degree
While it is not a necessity to obtain a master's degree or higher to become a CPA, or even to develop adequate skills as an accountant, some employers may require you to have at least, a master's degree. This will further enhance and develop your skills and may provide you with an opportunity to gain some experience.
Step Five: Gain Experience
You are now ready to enter the workforce. In most entry-level roles, you may find yourself working under the supervision of a more experienced forensic accountant, and this does prove to be beneficial in terms of the skills they will teach you and the knowledge they will impart to you. You will then be able to build upon these skills and refine your aptitude for the role.
This will often lead to growth in the role and position that you hold.
How Much Does A Forensic Accountant Earn?
According to the U.S. Bureau of Labor Statistics (BLS), Accountants and auditors, which is the general field that forensic accountants work under, earn a median annual salary of $77,250. The BLS also states that this field expects to see a 6% projected growth over the next decade between 2021 and 2031. About 136,400 new jobs are expected to become available each year.
What Skills Do You Need To Be A Forensic Accountant?
To be a good forensic accountant, you need to have skills that fall into the categories of both law enforcement and accounting. This means that you would need to have superior analytical and problem-solving skills, you would need to be really good at calculating numbers, working with financial details, and drafting reports.
But you would also need to have the skills to conduct witness and suspect interviews, you would need to have attention to detail, and the ability to effectively communicate in a variety of different settings (with suspects, witnesses, in court, among company shareholders, and within law enforcement teams).
How Long Does It Take To Become A Forensic Accountant?
It can take between 4-6 years to become a forensic accountant, during which you will obtain your bachelor's degree and any certification or internship programs you may require.
What Type Of Hours Do Forensic Accountants Work?
Forensic accountants may find themselves working 40-hour workweeks, but they may need to be available for court dates, and urgent investigative work if need be.
If you enjoy working with numbers, but you are seeking the unique thrill that comes with it, then perhaps this career is the best one for you. Follow the unique and interesting career path that forensic accounting has to offer.