Both good and bad reasons why a client can request a verbal report from the investigator. For
example, our manager requests us to give a verbal report about any project we are working on at
different steps during the project. This is to make sure that we are going in the right direction or
understand what is being asked of us before we invest too much time in the project. We have a new
member of our team that did not understand what was being asked of him. When he reported at
the end of the day what he had found, our manager was able to direct him in a different direction.
This may be needed forensic accounting investigations as the client may need to point out a
direction to focus on (Rosenberg, 2010).
The client may ask for an oral report to ensure that progress is being made on their project also. This
could be a time when a lawyer may be able to provide directions to look that the investigator had
not thought of as well. While eliminating information from a written report is never a good idea,
there may be analysis that need included in the report that is not already there (Rosenberg, 2010). If
the forensic accountant is missing a vital piece of information, this may be found during an oral
review of the report.
There is also the chance that the client is concerned with what has been discovered. In requesting
an oral report, they may find that the forensic accountant is not finding the information that they
had wanted and may end the project. They also may find that the forensic accountant was able to
uncover their fraud and want to prepare for what may happen.
A forensic accountant can be asked in many cases to present an oral report. c However, this comes
with a great deal of liability for the forensic accountant. c This is due to several pitfalls such as
misunderstandings, misrepresentations, and the fact that there is no documentation confirming or
denying the oral report. c A client can request an oral report for any engagement depending on their
needs and requirements. c This could be the case when a client is concerned about discovery in a
legal case, criminal or civil (Driskell III, 2019). c If there is no written report, then no report can be
produced or used against the client. c However, it is advisable in each oral report that a forensic
accountant prepare a written pre-report outline prior to the oral report and then after the oral
report a memo-to-file documenting the substance of the oral report to the client (Rufus, Miller, &
Hahn, 2015). This additional documentation can provide protection for the forensic accountant
from misunderstanding or misrepresentation, either intentional or not.
Clients may claim reliance on oral advice they allege erroneously or claim advice was not given at all
which can result in legal ramifications and reputation implications for the forensic accountant. This
oral advice could be in response to a client question and therefore forensic accountants must use
professional skepticism and knowledge in any engagement no matter how small or big it may seem. c
One way to accomplish this is by maintaining working papers that include the date, facts provided,
advice provided, relevant accounting and tax considerations, the appropriate disclaimers, notice that
no legal advice was provided, and items for client to follow-up (Wolfe & Ference, 2013). c It is
important to understand that oral communication is part of an engagement and one cannot always
know how the receiving party is going to take the information provided so it imperative to protect
oneself and provide the intent in the form of a follow-up documentation, wanted or not. c If not
wanted then the underlying intent should be considered.
References:
Driskell III, F. D., CPA. (2019, Autumn). Conducting forensic accounting and internal investigations.
Retrieved March 29, 2023, from https://willamette.com/insights_journal/19/autumn_2019_1.pdf
Rufus, R. J., Miller, L. S., & Hahn, W. (2015). Forensic accounting. Boston, MA: Pearson.
Wolfe, J., & Ference, S. B., CPA. (2013, October 01). Write it down: The importance of documenting
oral advice. Retrieved March 29, 2023, from
https://www.journalofaccountancy.com/issues/2013/oct/20138366.html
Rosenberg, J. (July 2010). Written Report? Oral Report? What's an Investigator To Do? c Retrieved
http://judithrosenberg.com/articles/caowi_1_3.html
