The Role of a Forensic Accountant in Litigation

When litigation is on the horizon, people are notoriously savvy in hiding assets, misrepresenting income and committing other crimes of financial deception. For the untrained eye, hunting for discrepancies in an endless stream of financial statements requires time you don’t have and rarely uncovers the clues needed to protect your assets in a civil case.

To give their clients the upper hand in the courtroom and uncover potential fraud, attorneys now more than ever are relying on the services of forensic accounting firms. Armed with extensive investigative and accounting experience, forensic accountants can identify inconsistencies in even the most complex of financial data and summarize their findings in simple, straightforward terms. In a civil matter where money is at the heart of the matter, the financial picture a forensic accountant paints can be the deciding factor in the court’s opinion.

When to Retain Forensic Accounting Services

Because of their specialized training, their breadth of knowledge in a variety of fields, and their experience in the courtroom, forensic accountants are regularly retained by legal teams to collect, prepare, analyze, and report on fiscal data for both civil and criminal cases, including:

  • Breach of contract
  • Employee fraud
  • Marriage dissolution
  • Bankruptcy cases
  • Trust and estate litigation
  • Shareholder or partner disputes
  • Issues related to company acquisitions, buyouts or dissolutions

Through their intensive auditing process, forensic accountants can quantify the economic damage one party has inflicted on another, providing clear, well-supported data that allows the court to establish how assets will be divided or what a plaintiff will be awarded in a civil case. When dealing with employee embezzlement, forensic accountants will thoroughly document the fraud and evidence that will help build a case for prosecution.

How a Forensic CPA Can Help Your Case

Depending on the lawsuit and the complexities of the financial evidence, a forensic accountant may be called upon solely for the initial information gathering stage or may work in conjunction with the attorney at every step in the case:

  • Discovery assistance – Forensic accountants often go to work before litigation ever starts. In the discovery phase, they can detect key issues that would define the framework of the case and identify for attorneys the relevant financial documents to subpoena.
  • Forensic Analysis – Using their investigative skills, forensic accountants dive into the data available and analyze the information to trace assets, calculate damages or determine any underlying fraud. From there, they can work with the legal team to best present the findings in court.
  • Expert testimony – A significant difference between a forensic accounting expert and a typical CPA is their experience in testifying in a deposition or at trial. As an expert witness, a forensic accountant will present their submission in court, and if requested, critique the reporting of opposing counsel.

Partnering With a Forensic Accounting Expert in Litigation

When your financial security or that of your company is on the line, it’s important to have both an experienced attorney and a forensic accountant on your side. At ARA Fraud & Forensic Services, our team of experts consist of Certified Fraud Examiners, Certified Public Accountant, former law enforcement and computer forensics professionals whose mission it is to uncover the truth. To learn more about our litigation expertise, contact us today.