Rule 702 of the Federal Rules of Evidence states that the expert
opinion of forensic accountants must be grounded in sufficient
relevant data. Finding sufficient and relevant data can be tricky, as
what is relevant or sufficient in one engagement may not be in
another. Some engagements may have an immense amount of data
available, while others may have very little. Time will always be an
issue where there is a lot of data, additionally, access to the data and
availability/access to technology both play a role as well. Data can
also be categorized into four levels, first, second, third, and forth. As a
forensic accountant I would strive to collect as much first and third
party data as I can. First party data is first hand information, second
party is second hand (one degree of separation). Third party is data
that comes from the people/entities who maintain records on the
subject and fourth is scholarly articles (including news publications
and government statistics). Each level has its own pros and cons,
however I feel that the strength and validity of data most often lies
mostly in first and third party data (Rufus, Miller, & Hahn, 2015).
There are five main ways that forensic accountants typically gather
data: interview, observation, public record, social media, and financial
statement analysis. But the type of data I would collect and analyze
would be case dependent. However, in order to be sure that I have
sufficient and relevant data I would choose to vary my data gathering
techniques (Rufus, Miller, & Hahn, 2015).
References
Rufus, R. J., Miller, L. S., & Hahn, W. (2015). Forensic accounting.
Pearson.
