Forensic accounting is the investigative arm of the accounting profession. Public accountants who specialize in forensic accounting investigate crimes such as securities fraud, embezzlement, bankruptcies, contract and divorce disputes, money laundering, and other financial crimes. Degrees in forensic accounting offer specialized training, combining accounting fundamentals with applied investigative and legal training.
Forensic accounting: An introduction
Forensic accountants analyze financial information to investigate alleged criminal behavior in the context of a legal dispute. According to the Association of Certified Fraud Examiners (ACFE), which represents forensic accountants, "Forensic accounting is the use of professional accounting skills in matters involving potential or actual civil or criminal litigation."
Forensic accounting may or may not involve an investigation of fraud; for example, forensic accountants also perform valuations of property on behalf of divorce litigants or shareholders in derivative suits.
Forensic accounting requires a knowledge of financial law as well as accounting and audit fundamentals. Accountants in this specialty develop strong analytic and deductive skills, supporting their combined role as accountant, auditor and investigator. Courses in traditional and online forensic accounting degree programs include:
- Asset valuation
- Fraud examination
- Computer forensics
- Money laundering investigation
- Tax auditing
- Interviewing techniques for fraud investigation
In addition, online business degrees in forensic accounting cover accounting and auditing basics such as tax law and reporting, accounting information systems, managerial accounting and corporate governance.
Online degrees in forensic accounting
Most accounting jobs require a bachelor's degree or higher, according to the U.S. Bureau of Labor Statistics (BLS). Some accountants get their start with a two-year associate degree and advance into a forensic accounting role with experience and on-the-job training. Available online forensic accounting degrees include:
- Associate of Science. The two-year forensic accounting degree offers a brief overview of accounting basics and special forensics training. Vocational and technical schools, community colleges and some universities offer online associate degrees in forensic accounting.
- Bachelor of Science. The most common qualification for accountants is the four-year bachelor's degree, which brings together general education, business and accounting fundamentals, as well as applied electives in forensic accounting.
- Master of Science. The graduate degree offers advanced training in forensic investigation as well as the opportunity for an independent research project. This degree is ideal for mid-career financial professionals looking to develop expertise in forensics.
- Master of Business Administration (MBA) with a forensic accounting concentration. The MBA offers a broad foundation in business and management, with some specialty courses and a capstone project in forensic accounting.
Licensure as a Certified Public Accountant (CPA) and certification as a fraud examiner offer a distinct professional advantage for forensic accountants. The ACFE, which administers the Certified Fraud Examiner (CFE) credential, reports that CFE-certified forensic accountants earned 44.6 percent more in 2010 than non-CFEs.
Careers in forensic accounting
Forensic accounting graduates work as forensic accountants or fraud examiners. They may serve as expert witnesses, and generally work closely with lawyers and law enforcement personnel. According to the ACFE, forensic accountants with the Certified Fraud Examiner credential earned a median salary of $107,000 in 2010 compared to $74,000 for non-CFE professionals. The BLS reported a mean salary for all accountants of $68,960 in 2010, indicating that forensic specialists may command higher compensation.
Graduates of online forensic accounting degree programs can look forward to strong demand for their expertise. The BLS forecasts 22 percent job growth between 2008 and 2018 for all accountants and auditors. Forensic accountants should see even more growth, reports the BLS, as demand rises for specialists trained "to detect illegal financial activity by individuals, companies and organized crime rings." The best opportunities are expected to go to accountants with certification, CPA licensure or a master's degree.
Forensic accounting at a glance
- Salaries: Forensic accountants with CFE certification report a median salary of $107,000 (Association of Certified Fraud Examiners).
- Education: A bachelor's degree or higher is needed for most forensic accounting jobs.
- Growth: Forensic accountants are expected to see some of the strongest job growth among accountants, according to the Bureau of Labor Statistics.