Fraud & Forensic Accounting

Fraud and Forensic Accounting

Something just doesn’t seem quite right. The financial statements are showing a profit but there isn’t enough cash to pay all of the bills. You begin to wonder where your bookkeeper got the money to buy the new house. Now may be the time to have a special review of your accounting records. Fraud reviews and forensic accounting services are tailored engagements to look for anomalies in accounting records. It involves an analysis of what is recorded, as well as what is not recorded.

Definitions

Fraud

Simple definition: Fraud is most simply defined as a deception made for personal gain. While there are more specific legal meanings, they may be different from one area of the country to another.

Legal definition: Fraud is any crime or civil wrong for gain that uses deception to commit the crime. Fraud occurs when a perpetrator deliberately deceives a victim for personal gain (i.e. to get property or services from him or her unjustly). Fraud can be accomplished through forgery, larceny or other methods. Fraudsters often utilize the mail, phone or internet to commit fraud.

Acts which may constitute criminal fraud include identity theft, embezzlement, forgery, false billings, false advertising, bait and switch, fause claims, Ponzi schemes and confidence tricks.

 

Forensic Accounting

 

Forensic accounting is the utilization of accounting, auditing and investigative skills to provide an analysis designed to be suitable for use in a court of law. The resulting report may be used as the basis for discussion, debate and dispute resolution as well. It also is designed to communicate financial information clearly and concisely. Forensic accountants are trained to look past the numbers.

Certified Fraud Examiners

 

Certified Fraud Examiners (CFEs) are professionals that have obtained a certification and are considered to be experts in detecting and deterring fraud. CFEs are not required to also be CPAs, however many are.

Common Types of Fraud

Types of Services

Fraud and forensic engagements are unique. No two are the same because no two instances of fraud are the same. Clients may want to prosecute the perpetrator or they may want to fix the problem and just move on. Engagement procedures are designed for each engagement to take into account the resolution expected by the client and the unique aspects of each situation.

Stories

Sue Bunevich, a Shareholder at MSL, has her Certified Fraud Examiners license and CPA certification. Sue was recently engaged for Fraud Examination services and uncovered the theft of $700,000 from a company. Once the theft was determined, Sue assisted in the recovery of the stolen funds.

For more information on MSL's services, call us at 1.800.683.5401 or contact us.