How to Become a Forensic Accountant?

If you aspire to start a career as a forensic accountant, that’s wonderful, because, in an era marked by increasing financial fraud and corporate misconduct, this profession is in high demand.

You should only ensure you have that knack for numbers and some detective skills. For you will be uncovering the financial misconduct in various organizations, including the ones governed by the states.

So, to have that passion and skill is very important. What else would you need to become one, if you’re wondering, stop it, for we are here to help you.

In this article, we will be discussing everything about forensic accountants, their work environment, salary, duties, advantages, and cons, how to become one and how long it takes; and much more.

Let’s start –

What is a Forensic Accountant?

Forensic accountants are professionals who use accounting, auditing, and investigative skills to uncover financial irregularities and provide evidence for legal proceedings.

They specialize in Forensic accounting by choosing a concentration or major in the field of accounting.

They play a critical role in uncovering financial wrongdoing, assisting in legal proceedings, and helping organizations safeguard their financial assets and integrity.

Let’s know more about them –

Work Environment

They often work in dynamic and collaborative settings, using their financial expertise to uncover and address financial misconduct.

Their work settings –

• Law Enforcement Agencies
• Attorneys
• Insurance Companies
• Corporate Security Departments
• Government Agencies
• Consulting Firm

Earning Potential

As per the 2023 salary data, the annual average salary of forensic accountants is $93,527. However, the top forensic accountants can earn up to $200,000 per year, or even more.

Actually; the earning potential can vary depending on factors such as education, experience, location, and the specific industry or employer.

But it is also noteworthy that, BLS keeps Forensic Accountants in the same category of Accountants and Auditors. So, as per the 2021 data by BLS, the annual average salary of accountants is $ $77,250.

Job Outlook  

Since the BLS keeps Forensic Accountants in the same category of Accountants and Auditors, we must assume the same job outlook for them.

However, experts believe that forensic accountants are the ones with very high demand with the surge in financial crimes, or cybercrimes.  

As per the BLS, the projected employment growth rate for accountants and auditors is 6% for this decade. This means that there will be almost 136,400 job openings every year.

What do they do? The Duties of a Forensic Accountant

As a Forensic accountant, you typically require a strong foundation in accounting and auditing, as well as specialized training in forensic accounting techniques and investigative procedures; to uncover financial misconduct. But there is more to it.

Here are some key responsibilities of a forensic accountant –

Detecting Fraud

They are called upon to investigate cases of fraud, including embezzlement, financial statement fraud, employee theft, and other fraudulent activities within organizations.

Investigating Financial Crimes

They examine financial records, transactions, and documents to uncover evidence of financial crimes. They may also analyze bank statements, invoices, tax returns, and electronic financial data during their investigation.

Gathering Evidence

They collect and preserve evidence that can be used in legal proceedings, such as court cases or internal investigations. They maintain the integrity of financial data to ensure its admissibility in court.

Expert Witness Testimony

They often serve as expert witnesses in legal cases. They provide testimony and expert opinions on financial matters to assist in resolving disputes and court proceedings.

Asset Tracing

In cases involving divorce, bankruptcy, or financial disputes, they are tasked with tracing and valuing assets, including hidden or undisclosed assets, to ensure equitable distribution.

Anti-Money Laundering (AML)

They may help organizations comply with anti-money laundering regulations by identifying suspicious financial activities and assisting in reporting requirements.

Insurance Claims Investigation

They also investigate insurance claims to assess the validity of claims, determine the extent of losses, and prevent fraudulent claims.

Cybercrime Investigation

With the rise of cybercrime, they may also specialize in investigating financial fraud and data breaches that involve electronic transactions and digital evidence.

Preventive Measures

They may work proactively to design and implement internal controls and fraud prevention strategies for organizations to reduce the risk of financial misconduct.

How to become a Forensic Accountant?

In an era marked by increasing financial fraud and corporate misconduct, undoubtedly, forensic accountants are in high demand.

If you aspire to start a career as a forensic accountant, you can opt to specialize in forensic accounting in 2 accounting degree levels, a Bachelor’s in accounting, and a Master’s in accounting.

Then, you can proceed accordingly to get your first job, and then advance your career with experience and education.

Let’s discuss this in detail in this step-by-step guide –

Step 1 – Research Schools and Gain Admission in a Bachelor’s or Master’s Program

To start with, research the schools that provide the best BA or BS degree in accounting, depending on your career goals, location, tuition costs, and any other personal preferences.

If you are already holding a Bachelor’s degree, then you can get a Master’s degree in Forensic accounting. Remember, there is no separate degree for forensic accounting, it is provided as a concentration within accounting.

Also, your choice of school would have different admission requirements, so review it closely. And fill in the application and submit it with all the asked details and attach the required materials.

Know More:

-> Accounting Bachelor Degree 

-> Master’s Degree in Accounting

Step 2 – Choose a Specialization or Concentration in Forensic Accounting

If you have opted for the bachelor’s degree, then there comes a day when you can choose a concentration, you need to choose forensic accounting.

After you choose it, you will be taking the coursework of forensic accounting and finding financial frauds or fraud examining, etc.

Just an advice, it is better if you choose to specialize in forensic accounting at the Baccalaureate level.

Step 3 – Complete the Coursework

A bachelor’s degree has 120 credits and takes around 4 years to complete for full-time students. Also, you need to complete the assignments, and clear all the semester exams to demonstrate your understanding of the subject and be eligible to appear for the final exam.

Step 4 – Get the Degree 

So, considering you have successfully passed the exam, you get your bachelor’s degree. Considering your program choice, you will receive a degree in accounting with forensic accounting as a concentration.  

Know More -> Forensic Accounting Degree  

Step 5 – Consider Internships or Externships and try to Network

Post-completion of the program or during it, if you get some hands-on experience opportunity, you should try it.

Also, if you find some part-time jobs, or volunteer opportunities related to forensic accounting, enroll in it. Practical experience can greatly enhance your resume and provide you with real-world exposure to accounting practices.

Building a professional network by attending career fairs, forensic accounting conferences and seminars organized by organizations can help you connect with potential employers.

Step 6 – Craft a Strong Resume

Create a well-structured resume that highlights your education, relevant coursework, internships, and any other related experience or skills. Tailor your resume to the specific job you’re applying for.

Step 7 – Consider Certifications

Depending on your career goals, you may want to pursue professional certifications. But, to become eligible for the forensic certification, you must hold a CPA license, or an accountant license first.

Apart from the CPA license, you also need to acquire 2 years of professional experience in some accounting or auditing roles.

In simple words, you first need to be an accountant and then move toward getting certified as a Forensic Accountant.

The Certifications for Forensic Accountants are –

• CrFA – Certified Forensic Accountant
• CFE – Certified Fraud Examiner
• CFF – Certified in Financial Forensics
• CISA – Certified Information Systems Auditor
• CVA – Certified Valuation Analyst

Step 8 – Apply for Jobs  

Start your job search by applying for forensic accounting roles. Choose the roles that are typically suitable for fresh graduates. Don’t worry, your career will grow with each passing day.

How Long does it take to Become a Forensic Accountant?

To become a Forensic Accountant, you first need to first get a bachelor’s degree in accounting. Post that you can choose a concentration in forensic accounting and then graduate as a bachelor’s in forensic accounting.

The course duration of a bachelor’s degree in accounting depends on the format of your education. Traditional full-time enrolment takes around 4 years to complete, or it might even take 5 years.

Online courses take around 2 years to complete if you put in extra effort and dedicate full time. If not, it would also take around 4 years to complete.

In most cases, you’ll get entry-level positions post-baccalaureate. But a master’s degree is the key to success.

So, considering a master’s you might require additional 2 to 3 years to complete your education. Post-completion of your master’s, you can start to apply for CPA certification.

Once you get it, you need 2 years of experience to apply for the CFE or CrFA certification. This again might take another 1 or 2 years to prepare and get certified.

Now, you are eligible to join the workforce as a forensic accountant. The total time might vary between 8 to 10 years, to become a forensic accountant.

Read More:

-> Is an Accounting Degree Worth it?

-> Requirements for Accounting Degree

-> How Long Does It Take to Get an Accounting Degree? 

Pros and Cons of being a Forensic Accountant

Being a forensic accountant can be a great career with good pay and job security, but it also requires a lot of education and comes with a big responsibility.

Here are the pros and cons of being a forensic accountant –

Pros of Being a Forensic Accountant

Let’s explore the pros of being a forensic accountant –

High Demand

They are needed a lot because there’s more financial fraud happening, so they’re always in demand. Businesses, law enforcement agencies, and government entities rely on these experts to unravel financial crimes.

As per the BLS, the projected employment growth rate for accountants and auditors is 6% for this decade. This means that there will be almost 136,400 job openings every year.

Career Opportunities

As a forensic accountant, you have a wide range of career options. You can work in many different places like companies, government, or consulting firms, which gives you lots of career choices.

If you work hard and get more certifications, you can get better jobs and make more money as you move up the ladder.

Lucrative Salaries

They usually get paid well because they have important special skills. The annual average salary of forensic accountants in 2023 is $93,527.

This is due to the unique and critical nature of the work. This financial reward reflects the specialized skills, high demand, and expertise they bring to the table.

Work Satisfaction

Their job is exciting because they solve tricky financial problems, which is interesting and makes them feel good.

The work of a forensic accountant is intellectually stimulating and often involves solving complex financial puzzles, making it personally and professionally rewarding.

Job Security

Since financial crimes keep happening, they don’t need to worry much about losing their job because their skills are always needed.

Cons of Being a Forensic Accountant

Let’s explore the cons of being a forensic accountant –

Education

They have to go to school for a long time and get extra certifications besides a CPA certification, like a CrFA or CFE. This takes around 10 years. This time investment might not suit all.

Also, costs for education and degrees are skyrocketing. With it, the costs of staying, fuel, and other expenses might push aspirants toward student debt.

But you can always look for online degree options.

Pressure and Responsibility

Sometimes, they have to work hard and handle stressful situations because they’re responsible for finding financial problems.

They have a big responsibility because they need to make sure they’re right when they accuse someone of financial wrongdoing. If they’re wrong, it can lead to bigger problems for them.

FAQs – Forensic Accountant

Can I become a Forensic Accountant with an Online Degree?

Yes, you can.

For that, you need to get an online bachelor’s degree in accounting and then choose forensic accounting as a concentration.

Consider getting a master’s, and going after certifications as well. This will prepare you to become a forensic accountant.  

For a bachelor’s degree, the course duration for most of the online programs ranges between 2 to 4 years. The course credits are the same, 120 credits. But there is a big price difference, where you only need to invest around $15,820 to $31,640.

For a Master’s degree, the course duration is 1 to 2 years with 30 credits and costs around $20,000.

More On -> Online Accounting Degree

What is a day in the life of a Forensic Accountant?

A day in the life of a forensic accountant can vary based on the specific job, industry, and employer. Most of the days are like that of an accountant but besides that, they fight white-collar crimes.

Their day involves –

• Analyzing financial data, examine financial statements, transaction records, and electronic databases to detect irregularities or patterns indicative of fraud.
• Utilizing data analysis techniques to detect patterns and anomalies in financial transactions.
• Conducting interviews with individuals relevant to financial investigations to gather information and evidence.
• Creating detailed reports summarizing findings, which may be used in legal proceedings.
• Presenting expert opinions and findings in court as witnesses to support legal cases.

Do forensic accountants work alone?

Forensic accountants often work both independently and as part of a team, depending on the nature of the case and their role within their organization or agency.

They often work in dynamic and collaborative settings, using their financial expertise to uncover and address financial misconduct.

Their work settings –

• Law Enforcement Agencies
• Attorneys
• Insurance Companies
• Corporate Security Departments
• Government Agencies
• Consulting Firm

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-> What Can I Do with an Accounting Degree? 

-> What Jobs can you get with an Accounting Degree?

How many forensic accountants are there in the US?

There are around 1,099,751 accountants who are working in the USA, and out of those, only 665,612 hold active CPA status in the USA. Out of those, there are only 34,525 Forensic Accountants, as of 2023.

Related:

-> How to become a CPA?

-> How to Become an Accountant?

-> Finance vs. Accounting Degree