Essay About Legal Responsibility Of A Forensic Account And Forensic Accountant

The Legal Responsibility of a Forensic Account While Providing Service to a Business
The legal Responsibility of a Forensic Account While Providing Service to a Business
When you think of accountant, you don’t think of crimes fighters. Well, that’s
exactly what a forensic accountant is. Forensic accountants are frequently engaged to
review insurance claims for business interruptions or lost profits. Business interruptions
(lost profits) insurance is intended to restore the claimants, not reward them with excess
reimbursement. A forensic accountant role in a business interruption can be complex and
difficult. A competent forensic accountant will provide an adjuster, policyholder, or legal
counsel with knowledge and experience. They do not provide coverage interpretation.
This is the responsibility of the adjuster or legal counsel. Forensic Accountants typically
use one or more of the following methods to calculate business interruption losses: (1) the
before-and-after method, (2) the comparable method (or yardstick method), or (3) the
breach-of-contract method.
Forensic accountants often assist in professional negligence claims where they are
assessing and commenting on the work of other professionals. Forensic accountants are
also engaged in marital and family law of analyzing lifestyle for spousal support
purposes, determining income available for child support and equitable distribution.
Some forensic accountants specialize in forensic analytics which is the procurement and
analysis of electronic data to reconstruct, detect, or otherwise support a claim of financial
fraud. The main steps in forensic analytics are (a) data collection, (b) data preparation, (c)
data analysis, and (d) reporting.
Forensic accounting or forensic accountancy has been used since the time of the
ancient Egyptians when Pharaoh had scribes account for his gold and other assets. As an
accountant they must have knowledge of the latest accounting standards and procedures,
be proficient