During an engagement, a forensic accountant may be asked to convey their findings
through an oral report. An oral report is a report that is verbal without written documentation.
Clients may request an oral report because of cost, secrecy, confidentiality, or a competitive
advantage (Rufus, et al, 2015). There are a few reasons why you should not give an oral report.
Some of those reasons are that the information may be misunderstood and there is no way to
confirm what was or wasn’t said. Clients will prefer oral reports when they are concerned with
legal privilege and discovery issues. If there is no report, evidence will not be available.
One example of a situation is if a forensic accountant is engaged to find if fraud
occurred inside of a company. The client may ask for an update to find out what the forensic
accountant has found. If the accountant gives the client an oral report, the client may deny
that the forensic accountant informed them of the indication of fraud. This could lead to legal
ramifications for the forensic accountant. The client may bring a lawsuit against the
accountant alleging that the accountant did not tell them the extent of the fraud. Since the
report was not written, there will not be any evidence to the contrary.
The best thing for a forensic accountant to do is to provide a written report. If the
client is set on an oral report, the forensic accountant should prepare a written outline,
including a memo-to-file. This will document the information provided in the oral report. Both
reports should be consistent with the information because they are subject to discovery.
Driskell, F. (nd). Conducting Forensic Accounting and Internal Investigations.
https://www.willamette.com
Rufus, R., Miller, L., Hahn, W. (2015) Forensic Accounting. Pearson Education
Wolfe, J., Ference, S. (2013, October 1). Write it down: The importance of
documenting oral advice.https://www.journalofaccountancy.com
