Earning an accounting degree online can open the door to many different paths involving accounting, finance, and similar careers. While the concept of accounting frequently evokes an image of reviewing financial transactions or preparing a tax return for the public, there are a wide variety of ways in which accountants apply their skills. One lesser-known but especially intriguing accounting career, forensic accounting, combines knowledge of financial practices and tax codes with a focus on legal disputes and working to a standard that can hold up to the exacting demands of a court of law. Let’s look at how forensic accountants work, the skills they need, their career and salary expectations, and other pertinent considerations.
What is forensic accounting?
Forensic accounting takes a wide range of accounting principles and related financial concerns and applies them to instances where legal disputes are in play. This is commonly tied to instances or suspicions of fraud, but is not limited to this concern. Businesses may decide to preemptively hire forensic accountants to review various records and transactions to ensure they’re absent of fraud or malfeasance, or even to identify areas that could lead to problems in the future. A simple forensic accounting definition is using standard accounting practices and a variety of other techniques, such as interviewing persons of interest, to determine if any nefarious or criminal actions occurred within a business’s operations or an individual’s financial management efforts.
Forensic accountants should develop and employ a number of skills to ensure they can effectively address the varied needs of their position. Accounting practices, such as reviewing financial information and understanding how laws and tax codes apply to it, are crucial. So is a grasp of general financial considerations, such as proper methods for bookkeeping and tracking the purchase, use, and sale of inventory, equipment, and other types of assets. Proficiency with a variety of technologies, such as database management tools, is important to make a variety of tasks around managing, accessing, and reviewing electronic records more manageable and efficient. An understanding of how spreadsheet programs, database tools and similar software can be used to obscure or misdirect stakeholders away from illicit activity can also be very valuable.
Communication is especially important in forensic accounting. While all accountants have to communicate information to clients, colleagues, and managers, often expressing the same idea in a number of different ways, forensic accountants also need to document and explain such information in additional professional and legal settings. Forensic accountants may be called upon to share the same information with internal investigators and high-level decision-makers at businesses, as well as in an expert witness role inside a courtroom. Both of these situations involve the business or one side of the court case relying on the forensic accountant involved. Sharing information in these settings often requires strong attention to detail. While these skills are necessary for all accountants, they take on added importance and increased significance for those in the forensic accounting field.
Forensic accountant salary, career progression, and job outlook
Forensic accountants are classified as part of the broader accountant and auditor group by the U.S. Bureau of Labor Statistics. The median yearly salary for that group is $69,350. PayScale’s more specific estimation of the average forensic accountant salary is $65,594, somewhat lower than the BLS projection but close to it. It’s important to note that PayScale projects a significant increase in salary over time for accountants in this role, with senior forensic accountants with 20 or more years of experience earning as much as $100,000 annually.
Some forensic accountant roles can be filled by those with a Bachelor of Science in Accounting degrees and related fields, as well as a specialized forensic accounting degree. Because of the sensitive nature of the job, however, some starting positions and many more senior roles require advanced education, some form of professional certification, or a combination of both. Forensic accountants may stay within this specialty as their careers progress or move into other areas of the profession, as well as enter a variety of managerial and executive roles.
The career outlook for accountants and auditors in general is strong, with the BLS projecting above-average job growth of 10% from 2016 to 2026. While forensic accounting jobs are a specialized subtype, the field has a strong potential for future growth.
Starting an accounting career with the University of Alabama at Birmingham
Students who want to pursue an accounting career can benefit from the combination of top-flight professors, flexible schedule, and a strong, well-rounded accounting degree online program UAB provides. To learn more, get in touch with an academic advisor today.