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Forensic Accounting: A Career Overview

By Steve Smith

The information presented here is true and accurate as of the date of publication. DeVry’s programmatic offerings and their accreditations are subject to change. Please refer to the current academic catalog for details.
 

April 17, 2023

8 min read

Forensic accounting is a specialized area of accounting where auditing and investigative skills and techniques are used to examine the finances and financial reports of individuals or organizations.

 

In this article, we’ll conduct an investigation of our own, answering the question “what is forensic accounting?” and uncovering more about what forensic accountants do, where they work, their education and certifications, and  some of the skills required to become one.

What Is Forensic Accounting?

This branch of general accounting focuses on the review and assessment of financial documents, and sometimes the investigation of the people behind those documents. 

In short, forensic accounting is investigative accounting. As the use of the word “forensic” implies, this area of the accounting profession is utilized in conjunction with criminal investigations of fraud, embezzlement or civil litigation, requiring forensic accountants to prepare documents that will be used in court.

What Does a Forensic Accountant Do?

The field involves meticulous record-keeping and a range of investigative techniques. While other accountants or CPAs may be engaged primarily in the practice of preparing and filing financial reports and tax returns for their clients, forensic accountants examine financial information to try to uncover wrongdoing. 

Forensic accountants may work for insurance companies, accounting firms, financial institutions, law firms or law enforcement agencies conducting fraud investigations to uncover evidence of financial misconduct and crimes such as embezzlement, money laundering, employee theft, identity theft or insurance fraud. Their findings are typically used in court in criminal prosecution or civil litigation, in a trial or as the basis of bringing criminal charges against a company or individual.
 

Forensic Accountant Responsibilities

The duties and responsibilities of these professionals will vary depending on the type of engagement they are hired for. Here are a few examples:
 

  • Bookkeeping investigations: Forensic accountants identify and investigate financial evidence, combing through accounting records and transactions to discover unethical activities like kickbacks, embezzlement or misappropriation of funds.

  • Due diligence contracts: Taking ethical, legal and regulatory factors into account, they conduct background checks of all parties involved in contractual agreements and screen for signs of identity fraud or other financial abuse.

  • Litigation support: In this area, forensic accountants may collect financial information related to criminal cases or civil litigation, such as personal injury lawsuits, matrimonial or breach of contract disputes.

  • Trial testimony: They may be asked to testify in court to explain their findings or as an expert witness.

  • Insurance claim investigations: These investigations usually involve the use of financial records and legal documents, which forensic accountants may be called upon to obtain.
     

Hard Skills for Forensic Accountants

Individuals in this branch of accounting must have foundational knowledge of accounting and a familiarity with the principles, standards and laws regarding the review and auditing of financial records. The hard accounting skills that enable them to accurately audit financial records in civil or criminal cases include:
 

  • Generally Accepted Accounting Principles: Thorough familiarity with GAAP enables financial investigators to spot instances where these principles have been ignored or intentionally misused.

  • Generally Accepted Auditing Standards: Forensic accountants apply GAAS, a set of standardized guidelines created by the Auditing Standards Board of the AICPA, to uncover tax evasion, misrepresentation, embezzlement and other financial crimes. GAAS ensures the accuracy, consistency and verifiability of financial auditors’ reports.

  • Knowledge of tax law: Because many of them focus on tax fraud or tax evasion, their skills must include a strong understanding of relevant tax laws.

  • Familiarity with financial reporting requirements: In the corporate world, intentionally inaccurate financial statements are a common form of accounting fraud. Forensic accountants need to be familiar with reporting requirements so they can identify and investigate unusual reporting practices.
     

Soft Skills for Forensic Accountants

To be successful, forensic accountants and auditors need to possess interpersonal abilities, or soft skills, aside from their technical knowledge. Examples of soft skills that are useful in forensic accounting include:
 

  • Attention to detail: This type of accounting involves the careful examination of financial data to uncover discrepancies or irregularities. In fraud detection, forensic accountants and forensic auditors must have analytical skills and a talent for paying attention to the small details to find what’s missing or what’s been altered.

  • Creative problem-solving: They must be able to respond quickly to changes in financial investigations, as the discovery of new evidence can cause an investigation to take various twists and turns.

  • Interviewing skills: Forensic accountants investigate people as well as financial records, so they may be required to interview persons of interest in civil or criminal investigations. Knowing how to ask the right questions and evaluate responses is an important skill.

  • Communication skills: They must be able to communicate effectively in both oral and written forms as they work with law enforcement and regulatory agencies or testify in court as a knowledgeable witness.
     

Where Do Forensic Accountants Work?

Careers for these accounting industry professionals can be found in various public and private-sector organizations, including:
 

  • Government: Government agencies like the Internal Revenue Service (IRS), Federal Bureau of Investigation (FBI), Drug Enforcement Agency (DEA) and some state and local authorities may hire forensic accountants to investigate criminal activity and security threats. In these roles, they typically trace the sources of financial support for criminal organizations.

  • Law firms: When involved in civil or criminal litigation, law firms may hire these experienced professionals on a contract basis or as staff members. Here the forensic specialists are typically tasked with determining financial damages, assessing the value of assets and finding evidence of wrongdoing.

  • Financial institutions: Banks, insurance companies and accounting firms all hire forensic accounting professionals. In accounting firms, they typically work in advisory departments, but some larger firms may have separate forensic accounting divisions. In banks and insurance companies, forensic accountants assess insurance claims, review documents and detect fraud or non-compliance with laws. 

  • Risk Consulting: Risk management consultants are used by large businesses to protect their financial interests and reduce potential losses. Companies may conduct independent reviews of each other’s finances prior to finalizing a merger or acquisition. Or companies or professional organizations may want to conduct independent assessments of their own financial records and want advice on how to navigate an inquiry by a regulatory agency.

Forensic Accounting Education and Certifications

If you want to prepare to pursue this career, it’s important to know the minimum education requirements. Since this occupation is not considered an entry-level position, you may need to pursue an advanced degree and industry-recognized certifications or gain several years of industry experience.
 

Degrees for Forensic Accounting

The U.S. Bureau of Labor Statistics (BLS) states that accountants and auditors typically need a bachelor’s degree to pursue this occupation, but some employers may prefer candidates for forensic accounting roles have a graduate degree, such as a master’s degree in accounting or a business administration degree with an accounting concentration.

At DeVry, our Bachelor’s Degree in Accounting program can help you build a strong foundation in accounting and economics. Our knowledgeable professors will help you gain an understanding of business technology, laws and government regulations, as well as business management and administration skills that will support your work in this occupation. Coursework in this program includes financial accounting, auditing, accounting information systems, critical thinking, federal income taxation and more. 

If you’re considering earning a higher-level degree, our online Master’s Degree in Accounting program revolves around accounting theory and practices, regulations and standards, advanced accounting studies, material needed to pursue professional licensure and more. Taught by faculty who are professionals in the accounting field, this program is designed to build on the skills you learned in your undergraduate program.

As a student enrolled in this program, you can choose to take a deeper dive into the procedures used in financial examination by choosing to take our Forensic Accounting: Ethics and the Legal Environment (ACCT574) course as part of your degree. In this course, you’ll explore detection and investigation of specific types of fraud, fraud prevention measures and how allegations of financial fraud must be investigated to meet the criteria for civil litigation or criminal prosecution.

Both our Bachelor of Science in Accounting and our Master of Science in Accounting have received specialized accounting accreditation by the Accreditation Council for Business Schools and Programs (ACBSP) https://acbsp.org.1
 

Forensic Accounting Certifications

Your path towards a career as a forensic accountant typically involves pursuing certification as a Certified Public Accountant (CPA), which entails both certification and licensing. At DeVry, our Master’s Degree in Accounting has Becker Professional Education’s CPA Exam preparation built right into the curriculum, so you can study for the CPA Exam2 while earning your degree.

CPAs are licensed by their states’ Board of Accountancy, and candidates must pass a national exam, meet other state-mandated requirements, and complete at least 150 semester hours of college coursework. All states use the 4-part Uniform CPA Examination from the American Institute of Certified Public Accountants (AICPA).

Other certifications that are available to professionals specializing in this field include:
 

  • CFF certification: The Certified in Financial Forensics credential is also issued by the AICPA. To be eligible for this certification, candidates must have a valid CPA license, pass the CFF exam, attest to the minimum business experience and professional development requirements and be a member of AICPA in good standing.

  • CFE certification: Issued by the Association of Certified Fraud Examiners (ACFE), the Certified Fraud Examiner (CFE) certification verifies knowledge of complex financial transactions, understanding of investigative techniques, the ability to resolve allegations of fraud and the ability to design effective fraud prevention programs. Only members of the AFCE can earn the CFE credential, after studying and applying for the CFE Exam.

  • CRFAC® certification: Issued by the American Board of Forensic Accounting, the Certified Forensic Accountant® credential assesses a CPA’s knowledge of and competence in the discipline and covers fraud, litigation services, cyber security for accountants, and valuations.

How to Become a Forensic Accountant

If you’re thinking about pursuing this career path, it’s important to learn and understand some of the steps you will need to take in areas that can include education, professional certifications, networking and how you approach your job search.
 

1. Earn your undergraduate degree

The first step you’ll need to take is to earn your undergraduate degree in accounting or a related field, such as business. At DeVry, we can help you get started by earning a Bachelor’s Degree in Accounting.
 

2. Consider a graduate degree

If you wish to continue pursuing your education in accounting to deepen your knowledge of the discipline, prepare to pursue more advanced-level career opportunities or qualify to take the CPA Exam, consider pursuing a graduate degree in accounting or a Master of Business Administration (MBA) with a Specialization in Accounting. Our online Master’s Degree in Accounting at DeVry and its Keller Graduate School of Management can help you gain hands-on experience with accounting concepts and, because our curriculum integrates elements of Becker Professional Education’s CPA Exam Review, help you to prepare for the CPA Exam.2

3. Earn professional certifications

In addition to passing the CPA Exam and obtaining licensure in your state, a forensic accounting career may require specialized professional certifications, as detailed earlier, that verify your skills in areas such as financial forensics and fraud investigation.
 

4. Identify opportunities through networking

Networking is an important component of any job search, especially in business or professional occupations. Developing contacts in the accounting profession can be beneficial toward pursuing opportunities for internships or entry-level employment. Informational interviews with faculty, alumni or friends or acquaintances with accounting experience can uncover opportunities and help you gain insights that are relevant to this specialty. Professional networking websites can help you develop contacts and discover opportunities. 
 

5. Start your job search

After earning the necessary education to prepare to pursue this career, and while pursuing professional certifications, you may feel prepared to apply for accounting jobs. Begin by updating your resume to include your formal education, professional experience and certifications. Review job descriptions for the positions that best match your career goals and refine your resume to match those descriptions.

Employment websites can help you find job openings that match your desired position, location and salary range. Your networking contacts should also hear from you at this stage, so be sure to send them a copy of your updated resume.

Forensic Accounting Career Outlook

Attributing growth in this occupation to an expanding economy, a complex tax and regulatory environment and continued globalization of business, the BLS projects employment of accountants and auditors to maintain steady growth at 4% from 2022 to 2032. They also project about 126,500 job openings each year, on average, over the decade.3 This growth is projected on a national level and local growth will vary by location. This projection is not specific to DeVry University students or graduates and may include earners at all stages of their careers, not just entry-level.

Forensic Accounting FAQs

Do you need to be a CPA to be a forensic accountant?‎

According to career path information from the Association of Certified Fraud Examiners, most forensic accountant positions require at least 1 to 3 years of accounting experience. A bachelor’s or master’s degree in accounting, forensic accounting, finance or a related field is required, and many employers encourage candidates to obtain CPA or CA (Chartered Accountant) licensure, but these are not strictly required.

What is the difference between a CPA and a forensic accountant?

A CPA is an accountant who has earned Certified Public Accountant certification and licensure, while forensic accounting refers to a particular type of accounting. Forensic accountants are not always CPAs, and forensic accounting can be performed by either CPA or non-CPA accountants.

Is there a demand for forensic accounting?

In addition to the job growth projected by the BLS, a 2022 report found the global market for forensic accountancy, which was valued at $5.13 billion in 2021, is estimated to grow to $11.68 billion by 2031, reflecting a compound annual growth rate (CAGR) of 8.8% from 2022 to 2031. 

Prepare to Pursue Your Accounting Career with DeVry

At DeVry, our online and hybrid4 accounting degree programs are designed with your career path—and your busy life—in mind. When you earn a degree or certificate at DeVry, you’re learning from faculty with real-world experience and exploring concepts that are relevant to today’s business world. 

DeVry is proud to be accredited by The Higher Learning Commission (HLC), https://www.hlcommission.org. Our Keller Graduate School of Management is included in this accreditation.

Study on your terms with DeVry. Our 6 academic sessions per year allow you to start when you’re ready and learn at your own pace, finishing on a regular or accelerated schedule that meets your personal and professional goals.

Let’s talk about how we can help get you started in our next session.
 

1 Student Achievement At-a-Glance - Available for all of DeVry and Keller's ACBSP accredited programs. For a full list of DeVry University's business and accounting degree programs accredited by ACBSP, please see the Accreditation page.

2 Credits and degrees earned from this institution do not automatically qualify the holder to participate in professional licensing exams to practice certain professions. Persons interested in practicing a regulated profession must contact the appropriate state regulatory agency for their field of interest. For instance, typically 150 credit hours or education are required to meet state regulatory agency education requirements for CPA licensure. Coursework may qualify for credit towards the State Board of Accountancy requirements. However, it is the student’s responsibility to contact the state board of accountancy for the jurisdiction in which they are applying to determine whether they have completed the appropriate credit hours and coursework to qualify to take the CPA exam. Employees of DeVry University and its Keller Graduate School of Management are not in a position to determine an individual’s eligibility to take the CPA exam or satisfy licensing. New York students should contact the NYSED Office of Professions regarding professional licensure.

3 Growth projected on a national level. Local growth will vary by location. BLS projections are not specific to DeVry University students or graduates and may include earners at all stages of their career and not just entry level. https://www.bls.gov/ooh/business-and-financial/accountants-and-auditors.htm

4 Program, course and extended classroom availability vary by location. In site-based programs, students will be required to take a substantial amount of coursework online to complete their program. 

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In New York, DeVry University operates as DeVry College of New York. DeVry University is accredited by The Higher Learning Commission (HLC), www.hlcommission.org. The University’s Keller Graduate School of Management is included in this accreditation. DeVry is certified to operate by the State Council of Higher Education for Virginia. Arlington Campus: 1400 Crystal Dr., Ste. 120, Arlington, VA 22202. DeVry University is authorized for operation as a postsecondary educational institution by the Tennessee Higher Education Commission, www.tn.gov/thec. Lisle Campus: 4225 Naperville Rd, Suite 400, Lisle, IL 60532. Unresolved complaints may be reported to the Illinois Board of Higher Education through the online complaint system https://complaints.ibhe.org/. View DeVry University’s complaint process https://www.devry.edu/compliance/student-complaint-procedure.html Program availability varies by location. In site-based programs, students will be required to take a substantial amount of coursework online to complete their program. Do Not Sell or Share My Personal Information.


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