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The term “forensic” is derived from the Latin word forensis, which means “of or pertaining to the public forum”. Today, the word takes on a more ubiquitous meaning describing a particular expertise or skill that is “suitable for use in a court of law or public debate”. Forensic accounting in the business world refers to the application of accounting, business principles and techniques to investigate and analyse financial data with the principal goal of providing impartial and reliable evidence to courts.

Forensic accounting has come a long way in the last couple of decades and is now recognised in popular culture with references to forensic accountants “following the money” in movies likes “The Accountant”, or in television shows like the Jack Ryan series.

In my experience as a practitioner forensic accounting can be divided broadly, into two (2) classifications:

  1. Investigation Services.
  2. Litigation Support Services.

Investigation Services

Law enforcement and regulators employ forensic accountants to investigate and analyse financial books and records of alleged offender. Arising from their investigation and analysis, the forensic accountant presents impartial and reliable evidence to Courts, Royal Commissions, Courts of Inquiry and/or Parliamentary enquiries. Forensic accountants are employed by both the Commonwealth and State law enforcement and regulators to investigate, to conduct financial analysis and provide expert evidence in relation to a wide variety of subject matter including:

  • Fraud and Financial Crime
  • Proceeds of Crime
  • Arson (evidencing the motivation for the offence was financial gain)
  • Murder (evidencing the motivation for the offence was financial gain)
  • Drug trafficking (evidencing the bad actor was carrying on the business of selling narcotics)
  • Taxation (the taxpayer has not complied with their taxpayer obligations)
  • Fair Trading Offences (alleged offender has conducted trade in an unlawful manner)
  • ASIC (a alleged offender has committed offences against the Corporations Law)

In my experience, once law enforcement starts the process of prosecuting an alleged offender including relying on forensic accounting evidence, often the defence legal team will engage a forensic accountant to review the Crown’s evidence, and if necessary, provide alternative opinion evidence in Court.

Litigation Support Services

As a general observation I expect the public is aware that if a business or a person has been subject to a fraud, then a forensic accountant is often engaged to investigate the fraud. The wider public may not be aware, however, that the opportunity for forensic accountants to be engaged in commercial disputes or litigation are boundless. Listed below are examples where a forensic accountant may be engaged to assist in a commercial dispute or litigation.  

As an observation, where a financial crime has been committed or there is dispute about money then in the background there will be a forensic accountant investigating, analysing, and providing evidence in a court.

If you would like to find out more about Vincents Forensic Accounting services, reach out to me here.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

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