What Are the Biggest Issues Facing Forensic Accountants

What Are the Biggest Issues Facing Forensic Accountants

By Unknown   7/16/2016   No comments:

Whether it is for the purposes of business valuation or other analysis of complicated data, an accountant can play an important role in identifying problems and establishing new protocol going forward. The forensic accountant will usually combine fiscal and legal skills in determining the presence of a crime or/and identifying those factors that should be considered in a business valuation. This role is increasingly more valuable since economic difficulties in 2008 have caused many businesses to analyze their activities much more closely in light of potential fraud. Since 2008, there have been key changes in crime and the way that the FBI and other government authorities pursue fraud.

The FBI, for example, created positions in this field within their own department and currently 15% of staff are specialists working on issues such valuation of companies and calculation of damages. Playing the role of forensic accountant can be a critical one as it will impact many individuals whether in a business valuation or a fraud sense. Perception is a key issue that forensic accountants face.

Although many clients could see forensics as just another accountant, there is a large difference in skillset between ensuring compliance to traditional practices and reconstructing the suspicious. Complexity and time management are also key issues for today's forensic accountants. Records tend to be immense even when they are organized digitally, and activity can extend across multiple jurisdictions. The timing of using a forensic accountant could also demand rapid and intense actions that constrain relationships with existing clients. If you are in the process of valuing a business or attempting to determine something that requires analysis of a lot of data, a forensic accountant may be just the person you need.

One of the most common times to bring in a forensic accountant is when a business needs valued. During a divorce, both parties may be highly interested in the valuation of a business because it can have a significant impact on the division of property. This is why it's imperative to have someone who has worked on business valuations before. With so much at stake, it requires the accounting and investigative skills of someone who knows how to dig into complex data and present a clear result. Not taking this seriously could lead to an incorrect valuation, which has many unfortunate impacts. Make sure you've fully vetted the forensic accountant you plan to hire before signing on the dotted line.

Article Source: http://EzineArticles.com/expert/Alexander_Thorston/2008196

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Fraudulent misrepresentation definition in fraud cases

Fraudulent misrepresentation definition in fraud cases

By Unknown   7/06/2016   1 comment:

 Misrepresentation definition in fraud cases: 

 

Fraudulent misrepresentation definition about material facts is most often thought of when the term fraud is used. Define misrepresentation cases can be prosecuted criminally or civilly. The gist of the offence is the deliberate making of false statements to induce the intended victim to part with money or property.

The specific elements of proof required to establish a misrepresentation definition vary somewhat according to where the fraud occurred and whether the case is brought as a criminal or civil action, but the elements normally include:

• The defendant made a false statement (i.e., define misrepresentation of a fact);
• The false statement was material (i.e., the statement was sufficiently important or relevant to influence the making of a decision);
• The defendant knew the representation was false;
• The victim relied on the misrepresentation definition;
• The victim suffered damages as a result of the misrepresentation definition.

Although it might be necessary to prove that the victim relied upon the false statements and actually suffered a loss in a civil case, these elements of proof might not be necessary in a criminal prosecution. In addition, in some statutes, materiality is assumed and need not be proved to define misrepresentation.

Normally, only material false statements may serve as the basis for a misrepresentation definition about material facts case. Materiality usually refers to statements sufficiently important or relevant to a reasonable person in acting or making a decision. For example about misrepresentation definition, a claim that a company enjoyed a 50 percent growth in profits would probably be material to a prospective investor, whereas a statement that the company was considering moving its headquarters from Toronto to New York City might not be. The materiality of allegedly false statements often is a central issue in security fraud cases and misrepresentation definition.

Moreover, in most instances, only false representations of "presently existing facts" can establish liability to define misrepresentation. That is, opinions by nonexperts, speculative statements about future events, and other general assertions, even if made with the intent to mislead, may not provide the basis for a misrepresentation definition because such statements are not material facts. For example, a used car salesperson who assures a customer that a 20 years old car, which was towed into the lot, will give the customer "years of driving pleasure" probably cannot be held liable to define misrepresentation. The salesperson, however, could be liable in the misrepresentation definition if he tells the customer that the car has been driven only 15,000 kilometres but knows that it has been driven 150,000 kilometres.

The general rule that opinions or speculative statements cannot give rise to a successful misrepresentation definition is often applied to prevent fraud claims in contract disputes. A party to a contract who promises to perform certain services by a particular but fails to do so generally may not be prosecuted for fraud unless the plaintiff can demonstrate that the defendant had the intent not to perform the promised services when the contract was made. Of course, the other party may file an action for breach of contract.

Also, the general rule precluding fraud actions based on opinions or speculative statements is subject to certain exceptions, principally cases involving opinions provided by professional advisers such as Certified Public Accountants.

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