Is your company involved in a legal case springing from a potential crime involving its finances? Modern companies face a variety of legal and financial entanglements ranging from employee theft to partner misconduct to cyber security issues. And for many of these cases, one of your best assets is a forensic accountant.
Many people know little or nothing about forensic accounting, but this specialty examines financial data and analyzes it to aid in pursuit of financial-related legal matters. And they can help your case in all stages of its development, from planning to execution. Consider these major steps and how forensic accounting can move the case forward at each point.
1. Case Development
An accountant can help the client and their lawyer understand and define the relevant information needed for the case. Because they are especially experienced in company bookkeeping and financial statements, they're in the best position to know what data is needed, how to find it, and how to make sense of it.
If the case involves employee theft, for instance, a trained accountant is uniquely qualified to follow the flow of money through the company's books. They can also avoid unnecessary research that won't further the actual case, such as by recognizing unusual transactions that appear questionable to the untrained eye but really aren't related.
2. Witnesses and Interviews
The individuals involved in your case can have a big impact on its success. And while an attorney should be involved in determining who can provide the witness assistance you need, an accountant is familiar with the ins and outs of working with company finances. The forensic accountant knows what specific questions to ask and who to ask them of. And they can converse fluently with other financial professionals.
3. Case Analysis
Once you know what your case is and who is likely to be involved, the accountant will get to work analyzing the books to find the truth. Building a solid case is vital to winning, but financial matters can get very complicated very easily. Money laundering, for instance, is deliberately designed to make certain transactions or the source of certain money invisible through multiple layering. Often, only a pro can unravel this.
Even less complex situations may need thorough research and analysis. If an employee has been siphoning off cash during transactions, the analysis may need to begin by comparing receipts and invoices with deposits. But they may need to identify apparently unrelated transactions in which the loss might have been hidden, prove who was responsible for the funds at various points, or establish a pattern of loss.
4. Presentation of Findings
Finally, the complex data and analysis needs to be turned into something your attorneys can present in a court of law. If the financial aspects are convoluted - such as fraud using derivatives or the difference between legal and illegal methods of tax avoidance - substantial translation may be necessary to help others understand. This is where a skilled, professional accountant can help.
The forensic accountant may also be called upon to provide an expert report as evidence or to refute an analysis by the opposing party's own experts. The earlier that an expert is on your team, the better they can help provide that professional assistance.
Clearly, forensic accounting analysis is helpful at all points during complex financial litigation. Could your case benefit from the services of a pro? No matter whether it's relatively straightforward or a complex subject, the answer is probably yes. Learn more about this legal service by making an appointment with the forensic analysis experts at Quality Bookkeeping Services, Inc., today.
