A forensic accountant is hired to provide a valuation for losses and serve as an expert witness in court
to support the findings. Forensic accountants are expected to allow room for the process to be
identified, explained, and verify the financial data when they are valuing a business. The forensic
accountant is to process and determine the economic value of the business. A forensic accountant
would demonstrate professional care, objectivity, and integrity in performance of the engagement by
speaking professional, in an authoritative manner and with confidence, by dressing and acting
professional. The forensic accountant can demonstrate integrity by telling the truth and not taking any
one side. Sometimes when I watch police officer shows and I see the detectives testifying it appears
that they take a side, and they alter their comments. They still tell the truth but they bend the truth a
little bit. The forensic accountant can demonstrate their integrity by making sure that they tell the truth
and not try to take sides. Going along with their gut instincts and keeping their morals and values.
The forensic accountant will be impacted in the ability to obtain sufficient evidence or data to support
his or her opinion by researching the evidence and testifying about it truthfully. Making sure that all
the evidence is collected accurately and bagged properly. Being professional will also help with the
outlook of testifying. “Forensic accounting is commonly associated with criminal investigations and
other legal proceedings. After all, it was forensic accountant Frank Wilson who uncovered evidence
that helped bring down Al Capone for tax evasion. And the “forensic” part of “forensic accounting”
does signify the application of scientific methods and analytical techniques in a manner suitable for
use in a court of law” (Shapiro, 2015). z
Principles of Professional Conduct
It is the forensic accountant’s responsibility, during their professional activities, to provide services to
their clients in such a way as to as to maintain the public’s confidence and to be able to self-govern.
This must be performed with integrity through being honest, maintain client confidentiality, being
ethical, objective, and independent. In this manner the forensic accountant can achieve their
responsibilities with competence and a continued dedication to learning and growing their profession
and provide to the best of their ability thorough services in which they are qualified to provide. z z
Rules of Professional Conduct
The forensic accountant should act in such a way by using the Principles of Professional Conduct as
an ethical compass, and the Rules of Professional Conduct in their performance of work.
They should only undertake work that they are able to complete with Professional Competence.
They should be able to be able to perform their work to provide reasonable assurance any material
misstatements of the financial statements through Due Professional Care.
They should remain independent, objective, and not pass judgement. They should comply with the
standards set and follow the accounting principles and take seriously their commitment to maintain
customer confidentiality. z z
A forensic accountant is often called to serve as an expert witness and give testimony in a trial. There
are a few principles that forensic accountants must follow during their engagements. A forensic
accountant must demonstrate professional care by having a degree of competency and skill. In this
case, the forensic accountant must have knowledge in land development. They should know how land
is valued, and the methods used to justify the valuation. The accountant’s conclusions should also be
supported with relevant evidence. Before the accountant agree to accept the engagement, they will
need to make sure there is no potential conflicts of interest. If there is, it must be disclosed. The
accountant must have objectivity in their engagement. This means that the accountant cannot take
sides in the case. They must remain impartial during the engagement. The accountant should also
demonstrate integrity by being honest and not be misleading. The information that is being given must
be true and reliable.
Obtaining evidence will require the accountant to behave with professional care and have objectivity
and integrity. The forensic accountant will have to conduct interviews to understand the details on
what happened during the breach of contract. They must be objective and gather the important
information. They will also have to make sure while gathering evidence they do not take sides in the
situation. They must remain neutral and gather the facts to be able to present to the court. If the
accountant is unable to demonstrate these principles, the evidence may not be relied on, and the
testimony will be false.
When a forensic accountant is hired to provide a valuation for losses and serve as an expert witness in
court, they must consider the AICPA principles of professional conduct as well as the federal rules of
evidence. The AICPA principles of professional conduct consist of six principles: responsibilities, the
public trust, integrity, objectivity and independence, due care, and scope and nature of services (Rufus
et al., 2015, p. 300). In the given situation, the forensic accountant could demonstrate professional
care by ensuring they adhere to all guidelines. This would include adhering to the rules of professional
conduct which include showing independence, professional competence, planning and supervision,
and obtaining sufficient relevant data. To demonstrate objectivity and integrity the forensic accountant
should follow Rule 102 that states members should maintain objectivity and integrity. There should be
no conflicts of interest. The member should also avoid misrepresenting facts knowingly. To be an
expert witness the forensic accountant must also adhere to Rule 702 which lays out the conditions in
which an expert witness is considered such and when they can testify in court. The forensic accountant
should have specialized knowledge and sufficient facts or data (Federal Evidence Review, 2016). In
following all the guidelines set forth, the collection of evidence or data should be sufficient to testify.
Now if the forensic accountant does not have knowledge in the field of land valuation, they couldn’t
be considered an expert witness or provide sufficient evidence as they would not be specialized in that
field.
A forensic accountant should perform an engagement with professional care, objectivity, and integrity.
"A member shall fulfill his or her professional responsibilities with competence and attention,"
according to professional care (AICPA, 2013). Being competent indicates that forensic accountants
have the professional training and skill set necessary to carry out the task for which they have been
recruited. It is the responsibility of forensic accountants to be aware of their training and experience
limitations and to refrain from taking on a case that is outside of their area of expertise.
A forensic accountant has to first confirm their independence from all parties involved before
performing a valuation and providing expert testimony. Any association with either party constitutes a
conflict of interest, which can lead to the exclusion of their testimony. Forensic accountants will be
able to perform their inquiries with objectivity if they are not connected to the parties at issue. The
obligation to be impartial, intellectually honest, and free of conflicts of interest is imposed by the
principle of objectivity, according to the Principles of Professional Conduct (AICPA, 2013).
A forensic accountant with integrity is one who abides by the AICPA Principles of Professional
Conduct and Rules of Professional Conduct and is seen as being trustworthy and honest. Over the
course of their career, forensic accountants will understand the value of integrity, which may be
demonstrated by acting consistently.
Being careful, objective, and honest in one's professional dealings can affect one's capacity to gather
enough data to support his or her opinion. To gather all the information required to complete an
engagement, the forensic accountant must speak with both parties, arrive at qualified conclusion.
Forensic accountants will be truthful and forthright in disclosing the information they believe will
contribute to a favorable decision if both parties trust that they are objective and have integrity in their
job. The parties may feel that offering evidence is pointless if they think the forensic accountant is
biased or unreliable. Additionally, if one of the parties thinks the forensic accountant lacks integrity,
they might think they can influence the forensic accountant by using coercion or bribery.
References
https://www.iaa.govt.nz/for-advisers/adviser-tools/ethics-toolkit/professional-ethics-and-codes-of-
conduct
Metz, Michael J PhD, (6 Oct, 2016)
tttps://journals.lww.com/thehearingjournal/Fulltext/2016/10000/Professional_Ethics_and_Business.2.
aspx
AICPA (2013, June 1) code of professional conduct and bylaws.
https://us.aicpa.org/content/dam/aicpa/research/standards/codeofconduct/downloadabledocuments/201
3june1codeofprofessionalconduct.pdf
Federal Evidence Review. (2016). Federal Rules of Evidence (2015). Retrieved from
https://web.archive.org/web/20180831001530/http://federalevidence.com/rules-of-
evidence#Rule702
Upper Saddle River, NJ: Pearson Education.
Rufus, R., Miller, L., Hahn, W. (2015) Forensic Accounting. Pearson Education
AICPA. (2013, June 1). Code of Professional Conduct an Bylaws. Retrieved from AICPA:
https://us.aicpa.org/content/dam/aicpa/research/standards/codeofconduct/downloadabledocuments/201
3june1codeofprofessionalconduct.pdf
Robert Rufus, Laura Miller, William Hahn. (2014). Professional Responsibilities. In Forensic
Accounting. Pearson Education.
Shapiro, D. (2015). Forensic Accounting: Beyond the Courtroom. Retrieved from:
https://sfmagazine.com/articles/2015/september/forensic-accounting-beyond-the-courtroom/
