Forensic bookkeeping is different from conventional bookkeeping because of the goals it aims to achieve. A forensic accountant intends to:
- Prove that a fraudulent event has occurred in a corporate setting.
- Identify the methods and sources of fraud or mismanagement.
- Identify the perpetrators and prove that they were behind it beyond a reasonable doubt.
Instead of the above, we’ll learn how a forensic accountant at MyRQB can help prevent fraud in today’s blog.
Running External Audits
You can hire a forensic accountant to audit your company’s financial affairs annually. As external auditors, they must evaluate and provide a thorough analysis of which cash controls may or may not be working for your company and recommend policy changes.
While small businesses could make do with annual audits, healthcare and manufacturing enterprises should ensure they have all their ducks in a row by hiring forensic accountants for quarterly audits. Furthermore, if you’ve gone public or run a non-profit organization, an external audit may be a mandatory requirement for your company.
Finding Gaps in the Accounting Processes
You need to hire the independent eyes of an outsourced forensic accountant to oversee the activities of your internal accounting department. They can review your financial data and provide ideas to prevent fraud and mismanagement, if any, helping you close the gaps in your accounting processes and plugging the cash drain.
You cannot entrust an internal forensic accountant with this job because they don’t have the objective perspective of an external auditor. They might be invested in the results directly or indirectly through their coworkers, which may lead to continued financial loss.
Tracing the Activity to its Source
Forensic accountants can create audit trails, showing illustrated or unillustrated accounts of each action, from when it was performed to what it entailed to how it concluded. These logs also contain more information about the IP addresses that performed these actions, helping your organization trace the people responsible for them.
Yet again, you may not have this massive advantage without a third party at your disposal. You can’t expect an employee to snitch on their coworker, not even if they don’t get along. For all you know, they might be trying to get them fired or, worse, prosecuted for a white-collar crime.
Trace the Digital Footprint of a Financial Crime with Our Forensic Bookkeeping Firm Online
Hiring a bookkeeper to work for your company is different from hiring them to work on behalf of your company. The latter entails outsourced bookkeeping, which you need when suspecting financial fraud or negligence at your corporation. Hire our forensic bookkeeping company to identify and address the issues and the people behind them and take appropriate measures to prevent them from happening again.
Get in touch for questions and concerns regarding forensic bookkeepers.
