How Much Does an Accountant Earn Yearly?
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A forensic accountant is both a financial expert and professional investigator who works for businesses, law enforcement and other government agencies, law firms, and insurance companies. Forensic accountants integrate their financial expertise and investigative know-how to help detect financial crimes.
Once it has been determined that such as crime has been committed, forensic accountants act as a type of consultant helping to catch, prove, and prosecute the suspects, organizations, and/or individuals in question.
Depending upon the particular type of organization or agency that employs a forensic accountant, his or her daily job duties can vary widely. However, no matter the field of specialization, all forensic accountants must use their expertise and knowledge of accounting practices, regulations, and finance law to fulfill their professional responsibilities.
A large percentage of forensic accountants specialize in investigating financial crime, which may include money laundering, employee theft, embezzlement, and insurance or securities fraud. In order to determine that such a crime has been committed, forensic accountants comb through enormous quantities of computer data to trace assets and examine transaction records, accounting statements, and other types of financial documents. They may also perform audits to assess income reporting and tax law compliance.
While some forensic accountants investigate financial crimes that may have already been committed, others work to anticipate and prevent those crimes from occurring in the first place. These forensic accountants supervise the activities and areas of finance that have proved too tempting to resist for individuals indicted and found guilty of financial crimes in the past. Perhaps the most typical example of such high-risk activity is the movement of large sums of capital across state and nation-state lines.
In cases of financial crime, forensic accountants serve as expert courtroom witnesses. Preparing their testimonies far in advance, they research the defendant/s and analyze the evidence and allegations against them in order to assist the court in determining whether or not a financial crime has been and can be proved to have been committed. Forensic accountants may even create computerized simulations and other visual presentations to help others understand complicated financial activities and terminology.
Relying on their accounting expertise and knowledge of finance law, procedures, and regulations, forensic accountants provide important consultation for law firms and their attorneys throughout the entire process of litigation. In instances of financial crime, forensic accountants help prosecutors develop their line of questioning and strategize their case within the framework of finance.
Forensic accountants also advise litigation teams throughout civil suits, such as uncovering hidden assets in cases of divorce and calculating the sum of financial damages in cases of corporate mergers and acquisitions. Most of the time, however, both sides in a civil case prefer to settle their financial disputes outside of court. By analyzing the terms of their contract and identifying if, when, and how those terms have been breached, forensic accountants help guide these negotiations towards resolution.
While some crimes are not technically considered to be financial in nature, their activities may have resulted in profit and financial gain. In these instances, forensic accountants help law enforcement officials locate and confiscate any such criminal proceeds by tracking the movements of funds.
Relying on their expert investigation skills and finance knowledge, the role of a forensic accountant in the FBI is to help hold individuals who have committed financial crimes accountable for their actions. Due to the rise in development of new terrorist organizations and surge in their recent attacks, forensic accountants have become more important to the FBI than ever before. Just like their FBI colleagues and agents, they are also responsible for improving FBI intelligence systems by adding their own reliable sources to the network.
While financial crime has always been capable of wreaking havoc, the effects of recent advances in technology and information sharing are far more destructive and can be felt almost instantaneously. In addition to detecting, avoiding and rectifying the consequences of such crimes, forensic accountants are also important to the health of overall global society and the survival of its financial institutions.
When conditions become dangerously unbalanced, forensic accountants are equipped with the knowledge and skill to to detect manipulations in currency valuations, exchange rates, and stock market activities. They also play an important role in preventing identity theft and protecting consumers from identity fraud.
Be it multinational organizations, local and state police departments or a federal intelligence agencies, the working conditions of a forensic accountant may vary depending upon the specific organization for which they work. In order to perform nearly all of their job duties, forensic accountants require powerful computers that are connected to extensive information-sharing networks and databases. Accordingly, the majority of forensic accountants spend their careers inside an office environment where they are surrounded by access to such technologies.
The work hours of a forensic accountant are typically from 9-5, Monday through Friday and/or 40 hours a week. However, as they are crucial in the criminal justice system and its processes of catching and prosecuting financial crimes, there are times when they may need to work much longer days, weekends, and even nights.
While both professionals spend their careers examining financial documents for discrepancies, it is essentially the nature, severity, and types of these discrepancies that distinguishes an auditor from a forensic accountant. For example, auditors review financial statements to confirm that all assets and income reported by a company and/or an individual within that company are accurate.
Most large corporation have their own full-time auditors on staff to ensure the activities of their accounting departments and employees are compliant with Generally Accepted Accounting Principles or GAAP. However, in order to eliminate internal collusions, many auditors are employed by external review companies such as the IRS.
On the other hand, while forensic accountants also review financial activities in search of discrepancies, the investigations that they perform are devised exclusively for identifying types of serious financial crime such as fraud and embezzlement. As opposed to working for privately-owned businesses and audit review companies, most forensic accountants are employed by law enforcement agencies. They work to catch those who have committed these fraudulent activities, determine how much money was taken, and come up with ways to prevent and/or make such crimes more difficult to commit in the future.
The career of a forensic accountant requires knowledge and skills from numerous different fields; such as business, business law, accounting, criminal justice, psychology, and technology. Accordingly, a forensic accounting degree program incorporates concepts from all of these areas and likely many more. The following is a great start to understanding what you may learn; however, it should be noted that this is not a complete list and there are more courses and areas that will be covered in a forensic accounting degree than what is mentioned here.
Future forensic accountants must first have a high school diploma, preferably with a GPA of 3.0 or higher, in which they focused on mathematics and statistics. Next, they will need to earn their bachelor’s degree from a competitive college or university in either forensic accounting, business, economics, accounting, or finance.
While a bachelor’s degree is all that is initially needed to enter the general field of accounting, aspiring forensic accountants should also earn an advanced degree in forensic accounting such as a master’s or even a doctorate.
The application requirements for acceptance typically include bachelor’s degree and professional certification transcripts, an undergraduate GPA no lower than 3.0, SAT, ACT, and GRE test scores, and a personal statement written by the applicant.
After earning his or her bachelor’s degree, an aspiring forensic accountant must become a Certified Public Accountant or CPA through either the American Institute of Certified Public Accountants (AICPA). However, in order to take the CPA exam, applicants must first complete 30 credit hours of advanced education — sometimes more and sometimes less depending upon individual state requirements.
After earning their CPA license, aspiring forensic accountants can earn Certified in Financial Forensics (CFF) certification through the AICPA. To take the CFF exam, applicants are required to hold an active CPA license and AICPA membership, continued professional education or CPE of 75 hours or more, and have worked as a professional accountant for a minimum of five years.
There are many other types of certifications that a forensic accountant may earn as well, such as the CFE or Certified Fraud Examiner through the Association of Certified Fraud Examiners or ACFE. They may also obtain the CIA or Certified Internal Auditor, which is accredited through the Institute of Internal Auditors or the IAI.
There are certain skills — hard, soft, innate, and learned — that one should possess in order to be a forensic accountant. Unlike many professions that primarily require one or the other, forensic accounting is one that mixes the analytical and technological with the intuitive and interpersonal.
To find out if you may have what it takes, review the following list for a great start to understanding the traits and characteristics you will need as a future forensic accountant.
An online forensic accounting degree integrates the studies of criminal justice, business, and finance law. However, unlike an on-campus degree program which teaches the same concepts but requires students to commute to a physical location, the classroom in this degree program is online. Students can learn about accounting, bankruptcy, and civil and criminal litigation directly from their personal computers right in the comfort of their own homes.
An online forensic accounting degree is perfect for those who need to continue working full-time throughout their education, who live far away from an on-site degree program, and/or have familial responsibilities such as caring for children or an elderly parent.
Forensic accountants receive a variety of advantages from their careers and professional life. Below are just a few examples of some of the most commonly-cited benefits.
While forensic accountants certainly love their careers, just like anything in life, there are also a few disadvantages to the profession. Listed below are four of the most common.
According to the Bureau of Labor Statistics, auditors and accountants should expect to see a 10% increase in job growth by 2026. The cause of such a particularly high and fast rate is attributed to the rise in multi-national corporations and economic globalization. However, the BLS considers forensic accounting a type of highly-specialized accounting sub-field and does not track nor make predictions about the profession’s demand, salary, or job outlook separately.
Nevertheless, due to the recent and rapidly-developing world of cryptocurrencies and other technologies, forensic accountants may see an even higher demand for their employment in the next decade.
Computer forensics investigation is a profession in which digital information is analyzed to uncover criminal evidence. While sometimes this process may include retrieving transaction statements, accounting information, and relevant documents for investigating financial crimes, computer forensics investigators also work other criminal cases such as murder and human trafficking.
In order to uncover these crimes and prosecute their perpetrators, computer forensics specialists search for evidence in emails, mobile devices, encrypted databases and networks, CDs and DVDs, and many other sources of electronic storage.
Forensic anthropologists study remains of the deceased in order to identify victims’ cause of death and obtain a variety of other relevant physical evidences. Integrating laboratory and field analysis expertise, the profession requires advanced scientific knowledge and ability to operate some of the world’s most sophisticated equipment and technology. While many forensic anthropologists work for the FBI and other law enforcement agencies, a large portion also work for research organizations such as universities and museums.
When physical evidence such as fabric fibers, fingerprints, blood, footprints, tire impressions, and other sources of DNA are obtained from a crime scene, they are brought to a crime lab for scientific investigation. There, forensic scientists and crime lab analysts examine the various forms of physical evidence for information and clues to help law enforcement officials identify and track down criminal suspects.
Information security analysts are computer systems experts who work to prevent unauthorized individuals and organizations from hacking into databases and stealing highly sensitive, confidential, and sometimes even government-classified information. Information security analysts help prevent identity theft and keep customers’ credit card information private while making online purchases.
Forensic ballistics is the study of firearms, the discharge striations they leave on bullets, and the markings of contact on physical matter that the bullets make. Based upon these things, a forensic ballistics investigator can usually determine which type of explosive and/or firearm a suspect used to commit a crime.