4 Types of Forensic Accounting Services (With Detail Explanation)

Forensic Accounting Services might not be so popular in some countries for example in Asian countries. But it is the high pay services in some countries like the USA.

In this post, I will list downs in detail the most popular Forensic Accounting Services often engaged with.

As you may know, most of the engagements that they normally engage with are fraud investigations, partner or shareholders disputes, insurance claims, etc. Here is the detail of those 4 Forensic accounting services:

1) Criminal Investigation Service:

Here is number one. It sounds like the FBI, Forensic Accountants also involves in a criminal investigations.

Of cause, most people in some countries normally though that auditor is the one who performs fraud investigation or criminal investigation, but actually, they are not.

And the one who performs criminal investigation is a forensic accountant or sometimes called a forensic investigator.

You probably wonder what this job should be done by the police. And why now we said that it could be done by a Forensic Accountant?

The thing is some kinds of jobs police might need more technical skills like reviewing documents, accounting records, accounting documents, etc. That is why most forensic accounting jobs need CIA, CPA, or equivalence skills like ACCA or CA.

2) Dispute Resolution Service:

You might know that in some companies the shareholders have some disputes with each other. And the problems are bigger and bigger leading to hard disputes.

In this case, the engagement with forensic accounting may require figuring out some object involve with the dissolution which majorly requires accounting skills.

3) Insurance Claim Review Services:

So, forensic accounting services do play a very important role to solve such a problem.

Forensic accounting does play a very important role related to insurance claims. Ranking from the low claim, small accidents like motor and personnel injuries to large claims like fire and aviation.

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Sometimes, insurance claims and settlements involve reviewing and checking the financial and accounting records, and business performance review if it is involved a business interruption.

Yes, most companies now buy insurance to cover their business interruption and if the CEO of those companies plays around with insurance companies, it will be a big loss as a result of fraud.

4) Fraud investigation Service:

Fraud investigation is a popular job for a Forensic Accountant. This fraud could be started from the staff level to the management level and from small cash to high-value assets.

There are many other services but I would love to list the last one from my list as professionally negligent.

Professional negligence just simply means that the person who provides professional service negligently finds out the mistake or fails to do something that a normal professional should do.

As a result of this negligence, someone who professionally is liable makes a loss. To find out whether professionals have negligence or not, the company would normally engage with a Forensic Accountant.

list of the most popular forensic accounting service companies

Forensic accounting services are in high demand due to the increasing complexity of financial transactions and the need for a thorough investigation into potential fraud or other financial irregularities.

Here are some of the most popular forensic accounting service companies:

KPMG

KPMG is one of the largest professional services companies in the world and offers a wide range of forensic accounting services.

The company provides investigative, dispute resolution, and compliance services to businesses and organizations of all sizes.

Deloitte

Deloitte is another large professional services firm that provides forensic accounting services. The company offers services in the areas of financial fraud investigation, corporate governance, and dispute resolution.

PwC

PwC is a global professional services firm that offers forensic accounting services to organizations in a variety of industries. The company provides services in the areas of fraud investigation, dispute resolution, and compliance.

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EY

EY, also known as Ernst & Young, is a large professional services firm that provides forensic accounting services to organizations of all sizes. The company offers services in the areas of fraud investigation, dispute resolution, and compliance.

BDO

BDO is a global professional services firm that provides forensic accounting services to businesses and organizations of all sizes. The company offers services in the areas of fraud investigation, dispute resolution, and compliance.

These are some of the most popular forensic accounting service companies. Each of these firms has a strong reputation for providing high-quality services and has a team of experienced professionals who are equipped to handle complex financial investigations.

When choosing a forensic accounting service company, it is important to consider the size and expertise of the firm, its experience in the industry, and its reputation for providing high-quality services.

Forensic accounting Vs. Internal Audit: Which service is the most expensive?

It is difficult to determine which is more expensive between forensic accounting and internal audit services, as the cost can vary greatly depending on the scope and complexity of the assignment.

The cost of a forensic accounting engagement will depend on factors such as the size of the organization, the complexity of the investigation, the length of time required to complete the investigation, and the resources required to complete the work.

Similarly, the cost of internal audit services will depend on factors such as the size of the organization, the scope of the audit, the resources required to complete the audit, and the complexity of the audit.

In general, forensic accounting services may tend to be more expensive than internal audit services due to the highly specialized nature of forensic accounting and the need for a higher level of expertise in this field.

However, it is important to keep in mind that the cost of either service will ultimately depend on the specific needs and requirements of the organization.

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Factors to Consider When Engaging Forensic Accounting Services.

When engaging in forensic accounting services, several factors must be considered to ensure that you choose the right provider and receive high-quality services.

Some key factors to consider include the following:

  1. Expertise and qualifications: Choosing a forensic accounting firm with the appropriate expertise and qualifications to handle your specific needs is important. Look for a firm with experienced professionals licensed and certified in forensic accounting and a track record of successful cases.
  2. Reputation: Consider the reputation of the forensic accounting firm and look for testimonials or references from past clients. Check the firm’s reviews online and research its importance in the industry.
  3. Availability and responsiveness: Choose a forensic accounting firm that is available and responsive to your needs. You want a firm that can provide timely and effective communication and support throughout the engagement.
  4. Industry experience: Look for a forensic accounting firm with experience in your specific industry. This can be particularly important if your case involves specialized knowledge or complex financial transactions.
  5. Technology and resources: Choose a forensic accounting firm with the appropriate technology and resources to handle your case. This may include software for data analysis, expert witnesses, and specialized equipment.
  6. Fees and billing: Consider the fees and billing structure of the forensic accounting firm. Look for transparency in pricing and ensure that the firm’s fees are reasonable and competitive.
  7. Confidentiality and ethics: Choose a forensic accounting firm that prioritizes confidentiality and adheres to ethical standards. Look for a firm that has a code of ethics and values integrity and professionalism.

Conclusion:

The above is the popular 4 Forensic accounting services that normally see in the market. But, in most cases, the service could be tailor base on the requirement.

Written by Sinra