Page 169 - DCOM409_CONTEMPORARY_ACCOUNTING

Contemporary Accounting

Notes Self Assessment

Fill in the blanks:
5. Forensic accounting emphasizes a forensic approach in place of a …………….approach to
the analysis of corporate governance.

6. Forensic Accounting involves the use of accounting/ auditing, investigative skills and
data mining as an …………….tool.

14.3 Forensic Accounting Engagement

A forensic accountant has to analyse, interpret, summarise and present complex financial and
business-related issues for investigation.
Coenen (2005) identify the following as areas of specialty in forensic accounting:
Investigating corporate fraud
Litigation services
Business valuation
Computer forensic
However, Zysman (2001) in a more elaborate form captured the assignment performed by
forensic accountant as including:

Criminal investigation, which are usually on behalf of the police with the aim of presenting
evidence in a professional and concise manner.
Shareholders and partnership dispute that involve analysis of numerous year financial
record for valuation and qualification of the issue in dispute;
Personal injury claim, where for example economic losses from motor accident or wrongful
dismissal may need to be quantified.
Business interruption and other type of insurance claim. These assignments involve a
detailed review of the policy to investigate coverage issues and the appropriate methods
of calculating the loss.
Business/employee fraud investigations which can involve fraud tracing, asset
identification and recovery, forensic intelligence gathering and due diligence review.
Business economic losses, where contract disputed, construction claims, expropriation,
product liability claim and trade mark are the issues.
Professional negligence, to ascertain the breach and quantify the loss involved, and
Mediation and arbitration, as a form of alternative dispute resolution.
14.4 Skill Requirement of Forensic Accountant

A Forensic Accountant should have the following characteristics:
curiosity
persistence

creativity
discretion
organization

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