White-collar crime has getting serious around the world if compare with the last few years. Bank fraud, credit card fraud, internet fraud, financial fraud, public corruptions and so on are considered as the crime. These crimes have shared the same characteristics that defraud money from unsuspecting victims which can call this as fraud. Richard and Kent (2010) stated that there are always misconceptions of white-collar crimes are non-violent and are committed by those who are non-violent in nature because it says that all white-collar crimes do not harm and violence so this is very perilous misconception. According to Kenneth (2010), Scottish Government has announced additional funds for development of forensic accountancy on 2nd June 2009 within the Scottish Crime and Drugs Enforcement Agency.
A part of the accounting purpose is detecting deception or fraud or white collar crime. Auditors have to lookout against fraud or deception which is something the interior or exterior by their periodic audits. To prove the fraud for a business that is identified fraudulent dealing, a new group of accounting are needed and they are called as forensic accounting. Forensic accountants will use their professional skills during carry out an investigation. They are not only need to respond swiftly and provide clear financial information but also being concise in courtroom. They are trained to look further than the numbers and handle with the business reality of the conditions. (Foresicglobal, 2012)
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Nowadays many universities have offered some advance degrees, certifications, and positions that are needed to qualify the accountants to become a qualified forensic accountant. Prosecution support or accounting investigation is typically involved by forensic accountants. They must have some form of certificate that is measurable of the work or career they are looking for. Certified in Forensic Accounting (CFF) is formed out by AICPA which is short form of The American Institute of Certified Public Accountants in 2008. AICPA got all the professional forensic accountants together and it makes CPAs become the most trusted advisor in business. (Aida 2010)
According to AICPA (2013), for new applicants that who want to get the CFF Credential, a valid CPA license or certificate issued by legally constituted state authority must be in hold. The CFF Credential Application is completed when they passed the CFF examination. Applicants must prove themselves have meet the minimum Business Experience and Education requirements and a credential fee is needed. (AICPA 2013)
Since forensic accounting requires professional knowledge that crosses the areas of accounting, criminal investigation, regulatory legislation and judicial litigation so it can considered as an exciting field. Forensic accountants need to know how the way the enterprises work is. Forensic accountants are expected to understand the way small and large enterprises operate, prepare evaluations in commercial and civil disputes, and reveal the darker side of business.
Owing to the aggressive growth of fraud around the world, the role of forensic accountants is getting more significant in last few years. These days, they are needed by many businesses to prevent or detect fraud that make it become a niche market. It is easy to get job if compare with other market such as IT which is in a saturated condition.
Forensic accounting is a wide job scope that required extra knowledge to tackle down the fraud schemes such as business law, auditing and tax. Instead of narrow working carrier that may limit forensic accounting students' potential abilities, it can lead to them to have multi choice of jobs.
As the demand of forensic accountants increases, the salary level will increases at the same time. It is a natural phenomenon when demand increases due to the market needs. Being a forensic accountant may have higher payment than other occupations. (Daug 2012)
Everything got negative sides. Because Forensic accountants need to find out the evidence that can send the defendants which conduct the fraud go to prisons, they are always having stress that come from their customers. Forensic accountants always need to work for longer time especially at the end of the year and tax season. Due to the complexity, they need a lot of times to investigate and examine securities frauds of the company. (Bureau of Labor Statistics 2012)
High costing of education is a drawback for a forensic accountant. Become a forensic accountant, the basic qualification is at least a Bachelor (BA) in Accounting. It enlarges the difficulty being a forensic accountant. Furthermore, experience requirements may need all the time such as experience in auditing, accounting of investigations. (Thomas 2009)
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A lot of frauds around the world have tackled down by forensic accountants. One of the biggest frauds in history is Madoff affair that perpetrated by Bernard L. Madoff in December 2008. (U.S. Securities and Exchange Commission, 2012) A total amount of sixty five billion dollars has been taken from investors to invest in his investment business. (Pbs 2009) This fraud's victim came from super rich to pensioners and financial institution or even local charities organization. It gave a big impact to the whole world economics and some big financial institution such as Walter Noel, US fund manager of The Fairfield Greenwich Group has the largest losses that seven and half billion dollars of its seventeen and half billion dollars invested with Madoff and ties to international wealth. (Jean 2008)
Another famous case is WorldCom Scandal and called as one of the serious corporate crimes in the U.S history. It was at one time the telecommunication company as the second long distance phone company in US. It was faced a massive accounting scandal that lead to bankruptcy in year 2002. Company's account numbers has been trumped up by management executive that inflating around twelve billion dollars. The bankruptcy of Worldcom led to massive losses for investors. (O.C and Linda, 2011) Several former executives of WorldCom have been involved in this case and faced criminal charges for it. Former CEO Berned Ebbers was punished twenty five years in jail (Pappalardo 2005) and Scott Sullivan as former CFO received five years jailed which consider a light sentence due to the bargain that he agreed to plead guilty and testified against Ebbers in 2005. (Ferranti 2005) Worldcom could not evade from bankruptcy and renamed as MIC in 2004. (Edward and Martin, 2006)
As the conclusion, in antagonistic or conflicting parties-that is needed to structure and support an opinion, forensic accountants must have great interesting in and the ability to extend accounting, auditing, fiscal and analytical skills to distinguish, document and analyze information. The forensic accountants should have self assurance and able to give respond instantly to the questions that got in court. Besides, can be given the answers of the question is more important, the court will understand them if must have a good communication about exceedingly technical and difficult financial information. (Forensicglobal, 2012)
AICPA (2013) Certified in Financial Forensics (CFF) Credential Overview (online) Available from: http://www.aicpa.org/InterestAreas/ForensicAndValuation/Membership/Pages/Overview%20Certified%20in%20Financial%20Forensics%20Credential.aspx [Accessed 9th Jan 2013]
AIDA S. (2010) ENHANCE YOUR PROFESSIONAL POTENTIAL: OBTAIN FORENSIC ACCOUNTING CREDENTIALS (online) Available from: http://aaahq.org/TwoYear/newsletters/Spring2010/item2.htm [Accessed 8th Jan 2013]
Bureau of Labor Statistics (2013) Accountants and Auditors (online) Available from: http://www.bls.gov/ooh/Business-and-Financial/Accountants-and-auditors.htm#tab-3 [Accessed 18th Jan 2013]
Daug G. (2012) Forensic accounting a growing niche field (online) Available from: http://robinson.gsu.edu/resources2/files/news/2012/forensic-accounting-abc.pdf [Accessed 17th Jan 2013]
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Forensic (2012) What is a Forensic Accountant? (online) Available from: http://www.forensicglobal.org/whatisfa.html [Accessed: 08th Jan 2013]
Jean S. (2008) Madoff collapse has global impact (online) Available from: http://www.wsws.org/en/articles/2008/12/mado-d18.html [Accessed 15th Jan 2013]
Kenneth M. (2010) Dismantling organised crime groups through enforcement of the POCA money laundering offences, Journal of Money Laundering Control, Vol. 13 Iss: 1 pp. 7 - 14
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PBS (2009) The Madoff Affair (online) Available from: http://www.pbs.org/wgbh/pages/frontline/madoff/etc/synopsis.html [Accessed 15th Jan 2013]
Richard G.B. and Kent A.K. (2010) From white-collar crime to red-collar crime, Journal of Financial Crime, Vol. 17 Iss: 3 pp. 351 - 364
Thomas L. (2009) What to Look for in a Forensic Accountant (online) Available from: http://www.nysscpa.org/sound_advice/forensic_acc.htm [Accessed 18th Jan 2013]
U.S. Securities and Exchange Commission (2012) The Securities and Exchange Commission Post-Madoff Reforms (online) Available from: http://www.sec.gov/spotlight/secpostmadoffreforms.htm [Accessed 15th Jan 2013]