- Forensic accountants read financial statements and investigate financial records and transactions to find irregularities.
- This career is often associated with law enforcement, but forensic accountants can find work in a wide variety of fields, including government agencies, insurance companies and nonprofits.
- The U.S. Bureau of Labor Statistics (BLS) projects that demand for accounting professionals is expected to grow by 7% between 2020 to 2030. This is about as fast as the average growth in demand for all occupations.
- University of Phoenix offers a Bachelor of Science in Accounting that can help prepare you for a career in forensic accounting.
Forensic accounting involves examining records to look for evidence of financial crimes. In this career, you might investigate crimes related to fraud, tax evasion, embezzlement or other forms of financial theft or misdeeds. Skilled forensic accountants are often called upon to serve as expert witnesses in court or provide reports and organize evidence for criminal or civil legal proceedings.
To jump into this career, take a look at what it takes to become a forensic accountant.
What does a forensic accountant do?
Forensic accountants read financial statements and look into financial records and transactions to find irregularities. They may work on cases involving money laundering, fraudulent tax returns, insider trading and other white-collar crimes.
These accounting specialists can work on criminal cases as part of an investigative team. They generally work in an office setting where they assess financial data and gather evidence to aid other investigators and legal prosecutors. Lawyers also might work with forensic accountants on civil cases.
Here’s a look at some of the duties one may perform in this career.
- Evaluating financial activities — A forensic accountant’s main duty is to assess an organization’s or individual’s financial records to find any evidence that may be related to criminal or civil crimes.
- Finding nonfinancial evidence — Forensic accountants sometimes look at nonfinancial information. They might look at someone’s social media posts or interview witnesses to find evidence of major purchases, hidden assets, unrecorded transactions or other signs of an extravagant lifestyle.
- Defining financial patterns — Forensic accountants often look for patterns in a person or company’s financial records. They then isolate transactions that do not fit within this established pattern.
- Deciding on compensation — Forensic accountants may also be called upon in civil cases to help determine fair compensation for a plaintiff.
These are the primary duties of most forensic accountants, though the exact nature of the job can vary from place to place.
Where do forensic accountants work?
This career is often associated with law enforcement, but you can also work in other areas for private employers.
Here are examples of industries where one might find work as a qualified forensic accountant:
- Government agencies, such as the FBI
- Insurance companies and private firms that perform audits on behalf of insurance companies
- Local, state or federal law enforcement agencies
- Investigative contract work for accounting firms
- Nonprofit organizations that review agencies and companies for financial fairness
- Banks and other financial institutions that require someone to evaluate evidence of financial wrongdoing, assess risk, perform internal audits and ensure compliance with regulations
Regardless of their specialization, forensic accountants work in a similar setting to those in other accounting specialties. They rarely work in the field and spend most of their time in an office.
Skills needed for forensic accounting
Forensic accountants acquire technical and specialized skills. This career also requires honing soft skills, which you can develop throughout your lifetime and in the early days of your career.
Here are just some of the soft skills you’ll need to succeed in this career:
- Investigative and auditing skills — A forensic accountant must understand the principles and procedures for performing an audit. They also need the knowledge and ability to assess financial data and find patterns and irregularities.
- Attention to detail — Forensic accountants must be able to look for information in large amounts of data, so they need to be able to pay attention to small details and discern subtle discrepancies in financial reports.
- Analytical skills — These skills are needed to assess the legitimacy of each transaction and find proof of financial wrongdoing using nonfinancial evidence.
- Communication skills — Forensic accountants need to communicate their findings with lawyers, other investigators, or company stakeholders and decision-makers. You also might have to serve as an expert witness in court cases and explain your findings in a nontechnical way for a judge and jury to understand.
- Logical thinking skills — You should be able to think critically and compare evidence and information from different sources systematically and logically.
- Problem-solving skills — A forensic accountant must have the problem-solving skills to find ways to locate data that’s not readily available through publicly available reports and that subjects may be actively trying to hide. Unlike many other accounting specialties, this one requires thinking outside of the box.
Although the number of skills you’ll need to develop to be a successful forensic accountant might seem overwhelming, most of them can be honed during your undergraduate and graduate studies.
How to become a forensic accountant
Most forensic accountants start by pursuing a degree in accounting to understand the principles of accounting before beginning to hone investigative skills. However, an education journey doesn’t stop here. Many forensic accountants also have to pass a licensure and certification test as well.
Before you consider a forensic accounting career any further, take a look at the education journey you’ll have to take:
Because of the technical skills needed for this job, entry-level positions require at least a bachelor’s degree in accounting. You may also be able to find a specialized undergraduate program in forensic accounting.
While the undergraduate degree is the minimum requirement for most employers, some positions require additional education. For this reason, you might consider a Bachelor of Science in Business program with a Financial Planning Certificate, an additional undergraduate Financial Planning Certificate or even a Graduate Finance Certificate.
Earning a bachelor’s degree can take up to four years or more, with up to two more years for a master’s degree. During your studies, you’ll cover different subjects, including the following:
- General accounting principles and practices
- Common financial reports and data
- Fraud examination
- Investigating techniques
In each subject, you’ll need to pass your exams. To successfully pass your exams and become a responsible student, regular class attendance will be required along with being able to study effectively at home.
Of course, studying at home is easier said than done, and typically involves advanced exam preparation practices. This may require reviewing your study material weeks before your exams instead of the last-minute studying that many students fall victim to.
Certifications and licensure
Technically, you do not need professional certification to start a career as a forensic accountant. However, some employers, such as law enforcement agencies, may require professional certification or licensure. Such accreditations can also help with career advancement and get you a better entry-level position.
There are two key accreditations that forensic accountants can pursue.
- Certified Public Accountant (CPA) — A CPA is a state license to practice accounting. While it is not necessary for every job, some state agencies require it for the forensic accountants they employ. It may also be required for some senior positions.
- Certified Fraud Examiner (CFE) — A CFE has fraud prevention, detection and deterrence expertise. CFEs are trained to understand complex financial transactions, recognize the warning signs that indicate fraud, and know the methods for resolving fraud allegations.
CPA requirements can differ from state to state, and law enforcement and government agencies may have certification requirements for all forensic accounting applicants.
Forensic accountant salaries
Salaries for forensic accountants can depend on degree level, certification, experience, type of employer and job location. Because positions have different requirements and demands, this career has a rather wide salary range. The annual salary for this occupation ranges from $45,220 to$128,680.
The salary ranges are not specific to students or graduates of University of Phoenix. Actual outcomes vary based on multiple factors, including prior work experience, geographic location and other factors specific to the individual. University of Phoenix does not guarantee employment, salary level or career advancement. BLS data is geographically based. Information for a specific state/city can be researched on the BLS website.
Forensic accountant job outlook
BLS projects that demand for accounting professionals is projected to grow by 7% between 2020 to 2030. This is about as fast as the average growth in demand for all occupations.
As commerce continues to globalize and more people rely on the internet for transactions, there will likely be a strong demand for forensic accountants to monitor the flow of money and investigate financial crimes related to e-commerce and cybercrimes.
Is becoming a forensic accountant right for you?
Forensic accounting could be a good career if you have math-related skills or naturally hold soft skills like analytical thinking or problem-solving. You also need the desire to work on investigations as part of a legal or law enforcement team.
You have to commit to a specific education to reach your career goals. Because of the importance of a degree in this field, you need to be sure you find the right college program so that you can learn all the skills necessary for a career in forensic accounting.
Interested in learning more about what a bachelor’s degree in accounting from University of Phoenix can do for your career? Learn more here!
Originally published at https://www.phoenix.edu.