What Forensic Accountants Do
Forensic accountants analyze and investigate financial activity. They usually do this in collaboration with police forces, government, banks, and insurance companies to determine the presence of financial fraud.
Forensic accountants may also do this work in independent practices. They work often with financial evidence and may use their findings in court cases, whether as an expert witness or to present visuals for the court. These specialized accountants are concerned primarily with white-collar financial crimes such as embezzlement, money laundering, and insurance fraud.
Who would enjoy a career in Forensic Accounting?
Successful forensic accountants are people with a desire to maintain honesty and accountability in the corporate world. They are passionate about justice and integrity. These qualities will motivate future forensic accountants to see the purpose of their work and find it rewarding. Great candidates for this job also have a proficiency for numbers, are great communicators, enjoy working with technology, and have a strong work ethic. White-collar crime, and the environments that breed it, should be of high interest to anyone considering this career path.
Who mightn't like the career?
Becoming a forensic accountant not only requires extensive education, but continued certification is often expected throughout one’s career, so it’s not an ideal choice for someone who isn’t committed to lifelong learning. Forensic accounting can also be intense work, requiring long hours and heavy subject matter at times. Those who seek a lighter career path should consider other options.
To become a forensic accountant, having a bachelor’s or master’s degree in forensic accounting can be required. Degrees in accounting, finance, or other related subjects are generally accepted. Depending on the employer, having a minor in or experience with criminal justice or law enforcement is ideal. There are also several credentials that are favored by employers and can lead to further opportunities and job growth as a forensic accountant: Certified Fraud Examiner (CFE), Certified Public Accountant (CPA), and/or Chartered Accountant (CA). For more information, see “Education Resources for Potential Forensic Accountants.”
There are many skills and areas of expertise specific to forensic accounting. To prepare for your interview, assess your strengths and weaknesses in these areas and speak to how you have implemented them in your previous work experience. For examples, employers will be looking for your knowledge of: white-collar crime, telemarketing fraud, money laundering, insurance fraud, embezzlement, credit card fraud, and other forensic intelligence gathering. Individuals should be able to demonstrate effective verbal and written and communication skills, credibility in previous positions, and work ethics as part of a team and independently.
Moving into Forensic Accounting from another career
For those in general accounting, forensic accounting may be a lucrative career switch based on its high demand and the elevated clientele and job responsibility. With the right certifications and continued education, it can be a smooth transition. Those with experience in finance and budget analysis may find success using their experience in conjunction with criminal justice and law education too. This career may also be a great choice for people working in the related fields of law enforcement, government, or law, provided finance and accounting skills are present.
Role: Many forensic accounting positions require general accounting experience. Employers may look for 1-3 years of experience in this position. General accountants examine finances for various organizations to make sure the company is operating according to all applicable laws and regulations. They prepare tax returns, ensure taxes are paid, and organize those and any other financial records. Based on their findings, general accountants may recommend ways to improve efficiency, reduce costs, or increase profits.
Role: Forensic accountants do many of the same tasks as general accountants. However, they take their financial examinations to a new level by working closely with law enforcement, lawyers, and government organizations to investigate financial criminal activity.
To do this, forensic accountants investigate and summarize financial findings, analyze account histories and transactions, and may use this information to prepare for legal disputes when necessary. They use general accounting practices to compile reports and presentations, and may even appear as expert witnesses in courtroom trials. On a day-to-day basis, forensic accountants work to make sure their organization or client is complying with all state and federal regulations.
Forensic accountants usually work in an office setting but may travel depending on the nature of the case at hand.
Data from PayScale shows that the average salary for forensic accountants in the United States is USD$66,000 and that most move on to other careers after 20 years of experience.
In Canada, the average is CAD$82,000. Forensic accountants in Canada typically don’t have more than 10 years of experience.
In the United Kingdom, where experience is a key factor in income, the average salary is £36,000.
Australian forensic accountants average a salary of AU$79,000, and just like in the United States, usually don’t remain in their careers after 20 years. According to the salary report from ACFE, forensic accountants with their CFE (Certified Fraud Examiner) credential earn 31% more than forensic accountants without this certification. This can add up to nearly a $600,000 income difference over a full career.
Bonuses, overtime, and profit sharing contribute to the salary of a forensic accountant.
Why Forensic Accountants move on
Forensic accountants may eventually desire a career change. This can happen for many reasons: they have grown as much as possible with their current company, they desire shorter work hours, their work life balance has become skewed, or they simply want to distance themselves from financial crime and the people involved.
Fortunately, the skills that come with years of experience as a forensic accountant are extremely valuable. Technology skills, the ability to analyze data and present it, being a team player, knowledge of legal jargon and culture, and excellent communication skills are just examples of assets that will make forensic accountants hireable if they end up back on the job market. For more information, see “Career Options for an Ex-Accountant” and “Accounting Skills That Future Employers Want.”