Forensic accountants find proof in the numbers when a malicious person commits a crime. By thoroughly examining company records, they can find out who did what – and how.
Financial crimes cost the economy $2.4 trillion every year, and the list of ways the criminals do this is almost endless. Having a strong task force of individuals who solve financial crimes is the best way to keep that number trending downward and minimize the impact that financial crime has on people and businesses around the globe.
A Closer Look at Forensic Accounting
The forensic accountant’s job is to work alongside other investigators (forensics accountants are, indeed, investigators) to find clues to crimes that lie within numbers. Crimes directly related to finances include fraud, money laundering, insider trading, tax evasion, and more, but forensic accountants also help solve crimes not directly related to money. A morbid example would be analyzing bank statements to see that an accused murderer bought a shovel two weeks before a victim’s body was found buried in the desert.
Utilizing a unique skill set that includes data analytics, investigative strategies, and an ability to “put oneself in someone’s shoes” sets up aspiring forensic accountants to work at a number of places beyond law enforcement, including insurance companies, law firms, public accounting firms, and other financial institutions.
You Would Never Think…
A real-life example of forensic accounting playing a huge role in a major case would be that of Bernie Madoff who ran a 20-year Ponzi scheme that cost his clients $65 billion and landed him a prison sentence of 150 years.
Forensics accountants were able to determine that almost all of Madoff’s transactions that were “on the books” he shared with his clients had never actually taken place in the financial world. A member of the team investigating even called the Madoff case “easy” as it came down to a simple comparison of “records” Madoff shared with clients and real records that showed the forensics team that no such transactions were ever made.
Breaking Into the Field: Undergraduate Studies for Forensic Accounting
Does all of this sound interesting and worth pursuing? An education in forensic accounting is the best way to break into this exciting field. In addition to a full breadth of accounting knowledge, education specific to forensics accounting will focus on data collection, reporting practices, legal proceedings (like how to be an expert witness in a trial), and criminal mindsets.
Couple these skills with the financial, economic, and mathematic knowledge gained from a regular undergraduate accounting degree, and you’ll be ready to start applying for jobs.
Do More, Earn More, Be More
Generally, a forensics accountant has a bit more glory and excitement than they do money in their wallets, but given the high importance of the job, it’s a great thing to have on a resume when applying for accounting jobs that pay the most.
One such job is that of a financial analyst for a company. Just as forensics accountants study data to determine odd (and often incriminating) trends, financial analysts look at short and long term trends in a company’s finances to plan for ups and downs in cash flow. The average pay for financial analysts is upwards of $80,000, and the job itself is expected to grow at a faster rate than other finance-related occupations.
If you think you have the unique skill set of being investigative and able to think like a criminal, and also have a will to collect, analyze, and evaluate numbers (sometimes on the grandest of scales), then a future in the forensic accounting world may very well be your ticket to an exciting and lucrative future… but make sure to spend all that money legally!
For more great career tips, check out the other blogs on Career Geek.