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Forensic Accounting

Submitted by mickeyphilli on November 5, 2005

Category: Business
Words: 1586 | Pages: 7
Views: 309
Popularity Rank: 30,885
Average Member Grade: N/A (Add a Comment / Grade this Paper)

FORENSIC ACCOUNTING
MORE THAN JUST NUMBERS

The field of accounting is no longer just for those who enjoy crunching numbers. Preparing financial statements, internal auditing, and tax accounting are only the tip of the iceberg. In today’s society of the “money hungry”, the “sue happy”, and the financially unfit, a new breed of accountant; the “Forensic Accountant” has emerged. Although Investigative Accounting has been around for years, it has only recently begun to transform into the science of accounting, hence Forensic Accounting. Forensic accountants are unique, looking beyond the numbers, digging deep to uncover fraud, hidden assets, and the like.
The word forensic is defined in Merriam Webster’s dictionary as “relating to or dealing with the application of scientific knowledge to legal problems.” The word accounting is defined in the same source as “a system of recording and summarizing business and financial transactions and analyzing, verifying, and recording the results.” By combining these two definitions it can be concluded that forensic accounting utilizes regular accounting practices in legal situations.
One of the most notable legal situations in the recent past would be the Enron scandals; forensic accountants were employed to sift through months and years of computer back-up tapes, dead files, and computer software programs to recover data where the hard copies had been shredded or somehow destroyed.
Another notable legal situation was the O. J. Simpson wrongful death litigation. Forensic accountants were hired to dig through his personal and professional papers so as to uncover any evidence of hidden assets that may have been of value in determining a monetary settlement. Forensic accountants are also being retained by divorce attorneys for the same purposes.
The Michael Jackson child molestation case also employed forensic accountants to dig into his financial situation. The prosecution...

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