Learn more about forensic accounting and the necessary skills and education needed to become a forensic accountant. In this article, determine whether this career path is for you.
Forensic accounting is a branch of accounting dealing with detecting and preventing financial crimes. As a forensic accountant, prepare to use competencies in accounting, auditing, and investigative techniques to detect and analyze cases of fraud and other financial crimes.
In 2023, the Canadian Anti-Fraud Centre received reports of losses of $530 million CAD, an increase of $150 million CAD more than in 2022 [1]. Explore how forensic accountants use their investigatory and analytical skills to identify different types of financial crime to get a feel for the job and if it aligns with your skills and interests.
Forensic accountants investigate fraud, embezzlement, and other white-collar crimes. As businesses become more complex, so will their financial investigations. Often, forensic accountants present accounting analysis and evidence in a trial or business-related issues. In this role, you could work in one or several of the following areas:
Business economic losses and bankruptcy: Expect to collaborate with businesses, creditors, and bankruptcy trustees to investigate possible fraud or mismanagement of assets in business bankruptcies or other situations involving economic losses.
Family and marital disputes: Liaise with attorneys and clients to investigate cases of possible fraud or misappropriation of assets in divorce or other family disputes.
Hidden or misappropriated assets: Forensic accountants may look for assets transferred or concealed by an individual or business.
Insurance claims: Work to investigate the claims to determine their validity.
Money laundering: If you identify a financial crime, you may pass on details to the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), which is primarily responsible for anti-laundering efforts within Canada.
Tax fraud: Work with the Canada Revenue Agency (CRA) by reporting potential tax fraud to their Leads Program.
An organization's financial statements provide an overview of its financial health. However, these statements may uncover only some of the story. In these cases, a forensic accountant may perform an investigation. The following offers a glimpse of the typical process of a forensic accounting audit:
The first step in a forensic accounting investigation is gathering all relevant information. This includes financial statements, tax returns, bank records, and any other documents that could provide information. With all the necessary data in hand, it is time to start investigating the numbers. This phase aims to identify any irregularities that could indicate fraud or wrongdoing.
Once the investigation is complete, forensic accountants report findings to the client. Depending on the nature of the case, they may also share these findings with law enforcement or other regulatory agencies.
In some cases, the findings of a forensic accounting investigation can lead to litigation. In such cases, you might provide expert testimony or support during the trial.
It’s essential to earn a bachelor’s degree in a related field when considering a career in forensic accounting. You will also need to gain professional experience, earn the CPA, and consider additional credentials such as certifications. Forensic accounting is a rapidly growing field that offers many opportunities for those with the right skills and forensic accounting education.
A few different types of degrees can lead to a career in forensic accounting. Getting a bachelor's degree in accounting, finance, economics, or statistics and successfully completing the Certified Public Accountant (CPA) exam can get you on your way. However, employers may also prefer candidates with a master’s degree, making it a valuable way to help set yourself apart from other applicants and enhance your knowledge.
After earning a bachelor’s or master’s degree, apply for entry-level accounting positions to get hands-on experience to help prepare you for the certified public accountant (CPA) licensure.
Remember that a forensic accountant is not an entry-level position, so employers may expect candidates to have practical experience in the field. Searching for job openings online, through commercial job sites, and local or federal government websites can help.
Many forensic accountants opt to earn a certified public accountant (CPA) designation. The certification requirements for becoming a CPA vary from province to province but generally involve passing an exam demonstrating mastery of technical skills, having at least a bachelor's degree, and meeting experience requirements.
While only optional, earning the CFF credential helps CPAs specializing in forensic accounting validate their experience and knowledge. It requires significant expertise, skills, and knowledge within forensic accounting. To earn this credential, you must complete 75 hours of professional development in forensic accounting, pass an exam, and have 1,000 hours of relevant work experience.
Prospective forensic accountants need to develop high-level skills in accounting, auditing, and investigative techniques. Forensic accounting is an advanced form of accounting that focuses on investigating financial crimes. A blend of technical and workplace skills is a must to become a forensic accountant.
Forensic accountants need technical skills in accounting, finance, and information technology. The following represents essential abilities you’ll need to master to understand financial statements and transactions, use accounting software, and reconstruct financial data:
Able to operate accounting software
Able to analyze financial documents
Know how to conduct technical interviews for witnesses or suspects
Have legal knowledge to review documents
Ability to analyze data to identify trends
Ability to conduct internal audits
To become a forensic accountant, you must also take time to develop various workplace skills to handle data and present findings. Some essential skills to have as a forensic accountant include:
Critical thinking
Detail-oriented
Excellent communication
Analytical thinking
Getting qualified as a forensic accountant takes time, so it's important to assess individual interests and define career goals before jumping into this career. Reflecting on these details helps determine if forensic accounting is the right career path. Consider the following questions:
Do you have an interest in finance and accounting?
Do you enjoy working with numbers and solving complex problems?
Are you interested in crime and learning the ins and outs of the law?
Answering the following questions will help narrow your career path and decide the next steps in your career.
Do you want to work for a government agency or a private company?
Do you want to specialize in a particular area of forensic accounting?
Explore the variety of jobs in forensic accountancy when embarking on this career path. Consider these job titles of forensic accountants and their annual CAD base salaries to explore your potential earnings:
Forensic auditor: $63,308 CAD [2]
Financial investigator: $68,305 CAD [3]
Fraud examiner: $55,878 CAD [4]
Fraud investigator: $54,834 CAD [5]
Senior forensic accountant: $69,368 CAD [6]
Forensic accounting senior associate: $68,730 CAD [7]
Think about some other job roles that overlap with forensic accounting when considering other job titles in the field:
Litigation support specialist: $50,151 CAD [8]
Financial analyst: $64,845 CAD [9]
Anti-money laundering analyst: $59,824 CAD [10]
Asset recovery specialist: $42,467 CAD [11]
Fraud prevention specialist: $43,978 CAD [12]
Forensic accounting is a complex and ever-changing field, so gaining specialist knowledge and keeping up with the latest developments can help you remain competitive. Consider leveraging the benefits of online courses to gain the entry-level forensic accounting skills and knowledge necessary to build upon an accountancy degree and start a career in this field.
For example, the Forensic Accounting and Fraud Examination Professional Certificate offered by West Virginia University can provide an excellent starting point. After completing the program, you’ll better understand different types of fraud and some of the latest tools you can use to detect them.
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Although having a CPA isn’t required, it is highly recommended. Some employers state in their job application criteria that you must have CPA certification to apply. Forensic accounting jobs are competitive, so becoming a CPA may be a step you want to take.
Getting an entry-level accounting job with an associate degree, such as bookkeeping or a support role, is possible. You can gain experience and certifications and work in a forensic accounting role. However, your chances of getting the job you want in forensic accounting are better if you have a relevant college degree.
Royal Canadian Mounted Police. “Fraud Prevention Month 2023: Fraud losses in Canada reach another historic level, https://www.rcmp-grc.gc.ca/en/news/2023/fraud-prevention-month-2023-fraud-losses-canada-reach-historic-level.” Accessed September 15, 2024.
Glassdoor. “Forensic Auditor Salaries, https://www.glassdoor.ca/Salaries/canada-forensic-auditor-salary-SRCH_IL.0,6_IN3_KO7,23.htm.” Accessed September 15, 2024.
Glassdoor. “Financial Investigator Salaries, https://www.glassdoor.ca/Salaries/canada-financial-investigator-salary-SRCH_IL.0,6_IN3_KO7,29.htm.” Accessed September 15, 2024.
Glassdoor. “Fraud Examiner Salaries, https://www.glassdoor.ca/Salaries/canada-fraud-examiner-salary-SRCH_IL.0,6_IN3_KO7,21.htm.” Accessed September 15, 2024.
Glassdoor. “Fraud Investigator Salaries, https://www.glassdoor.ca/Salaries/canada-fraud-investigator-salary-SRCH_IL.0,6_IN3_KO7,25.htm.” Accessed September 15, 2024.
Glassdoor. “Senior Forensic Accountant Salaries, https://www.glassdoor.ca/Salaries/canada-senior-forensic-accountant-salary-SRCH_IL.0,6_IN3_KO7,33.htm.” Accessed September 15, 2024.
Glassdoor. “Forensic Accounting Senior Associate Salaries, https://www.glassdoor.ca/Salaries/canada-forensic-accounting-senior-associate-salary-SRCH_IL.0,6_IN3_KO7,43.htm.” Accessed September 15, 2024.
Glassdoor. “Litigation Support Specialist Salaries, https://www.glassdoor.ca/Salaries/canada-litigation-support-specialist-salary-SRCH_IL.0,6_IN3_KO7,36.htm.” Accessed September 15, 2024.
Glassdoor. “Finance Analyst Salaries, https://www.glassdoor.ca/Salaries/canada-financial-analyst-salary-SRCH_IL.0,6_IN3_KO7,24.htm.” Accessed September 15, 2024.
Glassdoor. “Anti-Money Laundering Analyst Salaries, https://www.glassdoor.ca/Salaries/canada-anti-money-laundering-analyst-salary-SRCH_IL.0,6_IN3_KO7,36.htm.” Accessed September 15, 2024.
Glassdoor. “Asset Recovery Specialist Salaries, https://www.glassdoor.ca/Salaries/canada-asset-recovery-specialist-salary-SRCH_IL.0,6_IN3_KO7,32.htm.” Accessed September 15, 2024.
Glassdoor. “Fraud Prevention Specialist Salaries, https://www.glassdoor.ca/Salaries/canada-fraud-prevention-specialist-salary-SRCH_IL.0,6_IN3_KO7,34.htm.” Accessed September 15, 2024.
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