Manajemen | Fakultas Ekonomi Universitas Maritim Raja Ali Haji joeb.83.6.331-338
Journal of Education for Business
ISSN: 0883-2323 (Print) 1940-3356 (Online) Journal homepage: http://www.tandfonline.com/loi/vjeb20
An Empirical Investigation of the Relevant Skills of
Forensic Accountants
James A. Digabriele
To cite this article: James A. Digabriele (2008) An Empirical Investigation of the Relevant Skills
of Forensic Accountants, Journal of Education for Business, 83:6, 331-338, DOI: 10.3200/
JOEB.83.6.331-338
To link to this article: http://dx.doi.org/10.3200/JOEB.83.6.331-338
Published online: 07 Aug 2010.
Submit your article to this journal
Article views: 206
View related articles
Citing articles: 5 View citing articles
Full Terms & Conditions of access and use can be found at
http://www.tandfonline.com/action/journalInformation?journalCode=vjeb20
Download by: [Universitas Maritim Raja Ali Haji]
Date: 11 January 2016, At: 23:15
Downloaded by [Universitas Maritim Raja Ali Haji] at 23:15 11 January 2016
AnEmpiricalInvestigationoftheRelevant
SkillsofForensicAccountants
JAMESA.DIGABRIELE
MONTCLAIRSTATEUNIVERSITY
MONTCLAIR,NEWJERSEY
ABSTRACT. Theauthorinvestigated
whetherviewsoftherelevantskillsof
forensicaccountantsdifferamongforensic
accountingpractitioners,accountingacademics,andusersofforensicaccounting
services.Universitiesandcollegesarecurrentlyconsideringaddingforensicaccountingcoursestotheircurriculum.Theresults
ofthepresentstudyprovidemuch-needed
guidancetoeducatorsforthedevelopmentofforensicaccountingcurriculumby
identifyingpertinentskillstoaccompanya
programofstudy.
Keywords:financialdeception,forensic
accountant,relevantskills
Copyright©2008HeldrefPublications
F
rom business, government, regulatory authorities, and the courts,
evidenceindicatesthatahigherlevelof
expertiseisnecessarytoanalyzecurrent
complicated financial transactions and
events (Rezaee, Crumbley, & Elmore,
2006). As a result, forensic accounting has been thrown into the forefront
of the crusade against financial deception (Ramaswamy, 2005; Rezaee et
al., 2006). Bolgna and Linquist (1995)
defined forensic accounting as the
application of financial skills and an
investigative mentality to unresolved
issues,conductedwithinthecontextof
therulesofevidence.
Research continuously confirms that
preventing fraud and uncovering deceptive accounting practices are in strong
demandascompaniesrespondtocloser
scrutiny of their financial activities by
shareholders and government agencies
(Kahan, 2006). The Federal Bureau of
Investigation recently estimated that
white-collarcrimecoststheUnitedStates
morethan$300billionannually(KPMG
Forensic, 2003).Many of these crimes
aredifficulttoidentifybecausetheperpetrators have concealed their activities
throughaseriesofcomplextransactions.
Usuallylargevolumesoffinancialinformation are involved, and the complexity of these investigations can strain a
company’s resources (Brooks, Riley,
& Thomas, 2005; Kahan). In addition,
according to an American Institute of
Certified Public Accountants (AICPA;
2004)article,theuseofforensicaccountingprocedurestodetectfinancialreportingfraudshouldbeincreased.Thearticlearguedthatforensicaccountantsand
financial statement auditors have differentmindsets.Hence,auditteamsneedto
be trained to incorporate more forensic
accounting procedures into their audit
practicesandtoretainmoreforensicspecialiststohelpdetectproblems(AICPA;
Institute of Management &Administration,2004).
Forensic accountants currently apply
theiruniqueexpertisetoanarrayofdiverse
assignmentsandareoftenhiredtodetermine whether there has been any intentional misrepresentation associated with
a company’s financial records. Fraudulent misrepresentation can range from
overvaluation of inventory and improper
capitalizationofexpensestomisstatement
ofearningsandembezzlement(Harris&
Brown,2000;Messmer,2004).
Organizations also hire forensic
accountants for guidance when evaluating potential business transactions.
Forensic accountants assess a company’s true worth during a merger or
acquisitionandensurethatapurchaser
isknowledgeableaboutthetargetfirm’s
financial situation and value, while
lookingforsignsofsuspiciousaccounting activity (Harris & Brown, 2000).
Forensic accountants often provide
accounting expertise during existing or
July/August2008
331
Downloaded by [Universitas Maritim Raja Ali Haji] at 23:15 11 January 2016
pendinglitigation.Thisworkisprimarily focused on (a) quantifying damagesincasesofpersonalinjury,product
liability,contractdisputes,andintellectualpropertyand(b)uncoveringhidden
assets in complicated matrimonial law
cases.Thesetypesofservicesmayculminateintheforensicaccountant’sprovidingexpertwitnesstestimony(Durtschi, 2003; Messmer, 2004; Peterson &
Reider,2001;Ramaswamy,2005).
Forensic accountants also play an
important role in government. They
work for agencies such as the FederalBureauofInvestigation,theCentral
Intelligence Agency, and the Internal
Revenue Service. Forensic accountants
in this role look for signs of suspicious financial activity and fraud by
individualsandbusinesses.Inaddition,
forensic accountants have assumed a
morevisibleroleinhelpingthegovernment evaluate accounting and banking
records of suspected terrorists (Brooks
etal.,2005).
Inthisstudy,Iusedasurveytoinvestigatewhetherdifferencesexistinviewsof
therelevantskillsofforensicaccountants
among forensic accounting practitioners,
accountingacademics,andusersofforensic accounting services. Many universitiesandcollegesarecurrentlyconsidering
addingforensicaccountingcoursestotheir
curriculumoralreadyhave;thisevolution
has unearthed an absence regarding the
significant skill-set outcome that should
accompany forensic accounting education. The results of the present research
provide much-needed guidance that will
furtherassisteducatorswiththedevelopment of forensic accounting curriculum
by empirically identifying the views of
what the important skills of a forensic
accountantareamongthreemajorstakeholders:forensicaccountingpractitioners,
accountingacademics,andusersofforensicaccountingservices.
ReviewoftheLiterature
Twotypesofliteraturemotivatedthis
study: (a) the academic stream, which
rangesfromforensicaccountingcourse
coverage to course identification and
recommendation, and (b) the practitioner stream, which suggests the skills
that forensic accountants use in practice.Accordingtothe2006Association
332
JournalofEducationforBusiness
of Certified Fraud Examiners’ Report
to the Nation on Occupational Fraud
and Abuse, fraud costs companies in
theUnitedStates$652billionannually.
Thisstatisticemphasizestheimportance
offorensicaccountingeducation.
GroomerandHeinz(1994)foundthat
fraud-relatedtopicsweretaughtinmore
than31%ofexaminedinternalauditing
courses.Rezaee,Reinstein,andLander
(1996)foundthatfewuniversitiesoffer
a fraud or forensic accounting course.
Rezaee and Burtin (1997) concluded
that the demand for forensic accounting services will continue to increase.
In addition, Rezaee and Burtin found
that the academics and certified fraud
examiners differed in opinion of how
forensic accounting courses should be
offered. Academics preferred to integrate forensic accounting topics in the
existing accounting courses, whereas
the certified fraud examiners preferred
offeringaseparatecourse.Buckhoffand
Schrader (2000) examined the extent
to which academic institutions across
the United States are offering forensic
accounting courses. They found that,
on average, universities considered it
moderately important to add forensic
accounting to their curriculum. PetersonandReider(2001)reviewedcourse
syllabi of universities offering forensic
accounting courses and examined the
levelofthecourse,learningobjectives,
and course requirements. Their findingsindicatedthataccountingeducators
agreethatthereisaneedforuniversities
to provide forensic accounting education.Rezaee(2002)examinedasample
ofundergraduateandgraduateaccounting students, and the results indicated
that the students believed that forensic
accountingisaviablecareeroptionbut
isnotgettingtheproperattentionincollegesanduniversities.
The National Institute of Justice
(2005) prepared a model curriculum
guide for education and training in
fraud and forensic accounting to aid
academic institutions, public and private organizations, practitioners, faculty, and prospective students. Rezaee
etal.(2006)surveyedopinionsofpractitioners and academics regarding the
importance, relevance, and delivery of
forensic accounting education. Their
resultsindicatedthatthedemandforand
interestinforensicaccountingwillcontinuetoincrease.Bothpractitionersand
academicsviewedaccountingeducation
asrelevantandbeneficialtoaccounting
students. However, the groups differed
in opinions regarding topical coverage
offorensicaccounting.
Harris and Brown (2000) have identified specialized skills and technical
abilitiesofforensicaccountants.Forensicaccountantsareusuallyfamiliarwith
criminal and civil law and understand
courtroom procedures and expectations. Those researchers also stressed
investigative skills, including theories,
methods, and patterns of fraud abuse.
Forensicaccountantsthinkcreativelyto
considerandunderstandthetacticsthat
a fraud perpetrator may use to commit
and conceal fraudulent acts. Additionally,theyneedtoclearlyandconcisely
communicate findings to various parties, including those with less knowledgeofaccountingandauditing.Grippo
andIbex(2003)illustratedthatthemost
importantskillsofforensicaccountants
comefromexperienceinaccountingand
auditing, taxation, business operations,
management,internalcontrols,interpersonalrelationships,andcommunication.
Messmer (2004) stated that successful
forensicaccountantsmusthaveanalytical abilities, strong written and verbal
communication skills, a creative mindset,andbusinessacumen.Theymustbe
abletointerviewandelicitinformation
from potentially uncooperative people
andpossessastrongamountofskepticism.Ramaswamy(2005)believedthat
forensic accountants are distinctively
positioned to be able to uncover financial deceptions, their prominent skills
being an in-depth knowledge of financial statements, the ability to critically
analyze them, and a thorough understandingoffraudschemes.Ramaswamy
also believed that forensic accountants
should have the ability to comprehend
theinternalcontrolsystemsofcorporations and be able to assess their risks.
Last, knowledge of psychology helps
forensic accountants to understand the
impulses behind criminal behavior that
motivateandencouragefinancialdeception.Also,(a)interpersonalandcommunicationskillsthataidindisseminating
informationaboutthecompany’sethics
and (b) an understanding of criminal
Downloaded by [Universitas Maritim Raja Ali Haji] at 23:15 11 January 2016
and civil law and of the legal system
andcourtproceduresareskillsthataid
forensicaccountants.
The academic literature identifies
forensic accounting courses and content, whereas the practitioner literature
suggests skills necessary in practice.
However, the literatures have not yet
empiricallyidentifiedtheviewsofthree
major stakeholders—accounting academics, forensic accounting practitioners, and users of forensic accounting
services—regarding which skills are
importantforforensicaccountants.
The three aforementioned stakeholders will be significant in shaping the future of forensic accounting.
Accounting academics will educate
futurestudentswhowillbecomeforensic accountants; the practitioners must
be competent in their practice; and the
users (attorneys) have the potential to
structure changes in forensic accountingasthemarketfortheseservicesare
dictatedthroughcaselaw.
The present study adds the necessary incremental contribution to the
literature that identifies relevant skills
of forensic accountants and whether
any differences exist in the views of
thoseskillsamongthethreesignificant
stakeholders. In light of the growing
importance of forensic accounting in
the business environment, this study
provides useful information for faculty
members and universities working to
implement forensic accounting educationintheircurriculum.Asthisthriving
area of accounting continues to evolve
it will be necessary to ensure that the
correct skill set results from forensic
accountingeducation.
METHOD
I conducted a nationwide survey on
a random sample of 1,500 accounting
academics, forensic accounting practitioners, and users of forensic accounting services. For this study, I classified
attorneys as the primary users of forensic accounting services. The sample
wascompiledasfollows:Iretrieved(a)
500 random e-mail addresses of faculty members from accounting departments of various universities across the
nation;(b)500randome-mailaddresses
offorensicaccountingpractitionersfrom
several membership databases—the
NationalAssociationofCertifiedValuationAnalyst(NACVA),AmericanBoard
of Forensic Accounting (ABFA), Association of Certified Fraud Examiners
(ACFE), and the American Institute of
Certified Public Accountants (AICPA)
businessvaluationandforensicandlitigation services section (BVFLS)—and
(c) 500 random e-mail addresses from
a Google search of attorneys practicing
commercial litigation, matrimonial law,
and damages. These types of attorneys
oftenuseforensicaccountantsforarange
of damage, valuation, and fraud cases.
Thelikelihoodthatanattorneywhopractices commercial litigation, matrimonial
law,anddamagesdoesnotuseaforensic
accountant is slim because these types
of attorneys are the focus of marketing
efforts for accounting firms providing
forensicaccountingservices.
I prepared, pretested, and e-mailed
the survey instrument (see the Appendix). Participants were e-mailed using
http://www.surveymonkey.comandwere
asked the extent to which they agreed
withstatementsaddressingeachofnine
competenciesthatweredeemedbyprior
literature to be important skills of a
forensic accountant.The agreement ratingsweremadeona5-pointLikertscale
ranging from 0 (strongly disagree) to 4
(stronglyagree).
Initially,Icomputeddescriptivestatistics for group membership (frequencies
andpercentages)aswellastheresponses
relatedtotheninecompetencies(bothpercentages within each category and overall means and standard deviations). The
correlations among the nine items were
also computed. A principal component
analysis was then performed to examine the underlying structure of the nine
items. The eigenvalues-greater-than-one
rule was used to determine the number
ofcomponentstoextractandrotate.The
eigenvalues-greater-than-one rule states
thatthenumberoffactorstobeextracted
shouldbeequaltothenumberoffactors
having an eigenvalue (variance) greater
than 1. The rationale for choosing this
particularvalueisthatafactormusthave
varianceatleastaslargeasthatofasingle
standardizedoriginalvariable.Descriptive
statistics (ranges, means, standard deviations, and internal consistency reliability
coefficients)werethencomputedforthe
compositescoresresultingfromtheprincipalcomponentanalysis.
I used two-tailed tests and a Cronbach’s α level of .05 for all inferential
analyses.Themainsetofanalysesconsistedofaseriesofone-wayanalysesof
variances(ANOVAs)comparingpractitioners, academics, and users in terms
oftheirratingsoftheimportanceofthe
ninecompetencies.WhentheANOVAs
were statistically significant, follow-up
tests were performed by usingTukey’s
HSD. An alternative set of analyses
was performed by using nonparametricKruskal-Wallisteststocomparethe
importance ratings of the three groups.
InadditiontotheANOVAsandKruskal-
Wallistestsperformedontheindividual
items, similar procedures were used to
compare the three groups on the compositescores.
RESULTS
ItemDescriptiveStatistics
Atotalof252individualscompleted
thesurvey.Ofthese,102(40.5%)were
practitioners, 72 (28.6%) were users,
and 78 (31.0%) were academicians.
The overall response rate was 16.80%.
Descriptive statistics for the nine areas
of competency are shown in Table
1, including the percentage in each
responsecategoryandtheoverallmeans
andstandarddeviations.Theitemsrated
asmostimportantwerecriticalthinking
(M=3.63,SD=0.67),deductiveanalysis (M = 3.60, SD = 0.66), and written
communication(M=3.55,SD=0.61).
Theitemsratedasleastimportantwere
specificlegalknowledge(M=2.96,SD
= 0.86), composure (M = 3.29, SD =
0.67),andunstructuredproblemsolving
(M=3.34,SD=0.89).
The correlations among the importanceratingsfortheninecompetencies
are shown inTable 2.The highest correlations were between oral communication and written communication (r
= .73) and between deductive analysis
andcriticalthinking(r=.69),whereas
the lowest were between unstructured
problem solving and oral communication(r=.24)andbetweenunstructured
problemsolvingandwrittencommunication (r = .30). All correlations were
statisticallysignificant(p
ISSN: 0883-2323 (Print) 1940-3356 (Online) Journal homepage: http://www.tandfonline.com/loi/vjeb20
An Empirical Investigation of the Relevant Skills of
Forensic Accountants
James A. Digabriele
To cite this article: James A. Digabriele (2008) An Empirical Investigation of the Relevant Skills
of Forensic Accountants, Journal of Education for Business, 83:6, 331-338, DOI: 10.3200/
JOEB.83.6.331-338
To link to this article: http://dx.doi.org/10.3200/JOEB.83.6.331-338
Published online: 07 Aug 2010.
Submit your article to this journal
Article views: 206
View related articles
Citing articles: 5 View citing articles
Full Terms & Conditions of access and use can be found at
http://www.tandfonline.com/action/journalInformation?journalCode=vjeb20
Download by: [Universitas Maritim Raja Ali Haji]
Date: 11 January 2016, At: 23:15
Downloaded by [Universitas Maritim Raja Ali Haji] at 23:15 11 January 2016
AnEmpiricalInvestigationoftheRelevant
SkillsofForensicAccountants
JAMESA.DIGABRIELE
MONTCLAIRSTATEUNIVERSITY
MONTCLAIR,NEWJERSEY
ABSTRACT. Theauthorinvestigated
whetherviewsoftherelevantskillsof
forensicaccountantsdifferamongforensic
accountingpractitioners,accountingacademics,andusersofforensicaccounting
services.Universitiesandcollegesarecurrentlyconsideringaddingforensicaccountingcoursestotheircurriculum.Theresults
ofthepresentstudyprovidemuch-needed
guidancetoeducatorsforthedevelopmentofforensicaccountingcurriculumby
identifyingpertinentskillstoaccompanya
programofstudy.
Keywords:financialdeception,forensic
accountant,relevantskills
Copyright©2008HeldrefPublications
F
rom business, government, regulatory authorities, and the courts,
evidenceindicatesthatahigherlevelof
expertiseisnecessarytoanalyzecurrent
complicated financial transactions and
events (Rezaee, Crumbley, & Elmore,
2006). As a result, forensic accounting has been thrown into the forefront
of the crusade against financial deception (Ramaswamy, 2005; Rezaee et
al., 2006). Bolgna and Linquist (1995)
defined forensic accounting as the
application of financial skills and an
investigative mentality to unresolved
issues,conductedwithinthecontextof
therulesofevidence.
Research continuously confirms that
preventing fraud and uncovering deceptive accounting practices are in strong
demandascompaniesrespondtocloser
scrutiny of their financial activities by
shareholders and government agencies
(Kahan, 2006). The Federal Bureau of
Investigation recently estimated that
white-collarcrimecoststheUnitedStates
morethan$300billionannually(KPMG
Forensic, 2003).Many of these crimes
aredifficulttoidentifybecausetheperpetrators have concealed their activities
throughaseriesofcomplextransactions.
Usuallylargevolumesoffinancialinformation are involved, and the complexity of these investigations can strain a
company’s resources (Brooks, Riley,
& Thomas, 2005; Kahan). In addition,
according to an American Institute of
Certified Public Accountants (AICPA;
2004)article,theuseofforensicaccountingprocedurestodetectfinancialreportingfraudshouldbeincreased.Thearticlearguedthatforensicaccountantsand
financial statement auditors have differentmindsets.Hence,auditteamsneedto
be trained to incorporate more forensic
accounting procedures into their audit
practicesandtoretainmoreforensicspecialiststohelpdetectproblems(AICPA;
Institute of Management &Administration,2004).
Forensic accountants currently apply
theiruniqueexpertisetoanarrayofdiverse
assignmentsandareoftenhiredtodetermine whether there has been any intentional misrepresentation associated with
a company’s financial records. Fraudulent misrepresentation can range from
overvaluation of inventory and improper
capitalizationofexpensestomisstatement
ofearningsandembezzlement(Harris&
Brown,2000;Messmer,2004).
Organizations also hire forensic
accountants for guidance when evaluating potential business transactions.
Forensic accountants assess a company’s true worth during a merger or
acquisitionandensurethatapurchaser
isknowledgeableaboutthetargetfirm’s
financial situation and value, while
lookingforsignsofsuspiciousaccounting activity (Harris & Brown, 2000).
Forensic accountants often provide
accounting expertise during existing or
July/August2008
331
Downloaded by [Universitas Maritim Raja Ali Haji] at 23:15 11 January 2016
pendinglitigation.Thisworkisprimarily focused on (a) quantifying damagesincasesofpersonalinjury,product
liability,contractdisputes,andintellectualpropertyand(b)uncoveringhidden
assets in complicated matrimonial law
cases.Thesetypesofservicesmayculminateintheforensicaccountant’sprovidingexpertwitnesstestimony(Durtschi, 2003; Messmer, 2004; Peterson &
Reider,2001;Ramaswamy,2005).
Forensic accountants also play an
important role in government. They
work for agencies such as the FederalBureauofInvestigation,theCentral
Intelligence Agency, and the Internal
Revenue Service. Forensic accountants
in this role look for signs of suspicious financial activity and fraud by
individualsandbusinesses.Inaddition,
forensic accountants have assumed a
morevisibleroleinhelpingthegovernment evaluate accounting and banking
records of suspected terrorists (Brooks
etal.,2005).
Inthisstudy,Iusedasurveytoinvestigatewhetherdifferencesexistinviewsof
therelevantskillsofforensicaccountants
among forensic accounting practitioners,
accountingacademics,andusersofforensic accounting services. Many universitiesandcollegesarecurrentlyconsidering
addingforensicaccountingcoursestotheir
curriculumoralreadyhave;thisevolution
has unearthed an absence regarding the
significant skill-set outcome that should
accompany forensic accounting education. The results of the present research
provide much-needed guidance that will
furtherassisteducatorswiththedevelopment of forensic accounting curriculum
by empirically identifying the views of
what the important skills of a forensic
accountantareamongthreemajorstakeholders:forensicaccountingpractitioners,
accountingacademics,andusersofforensicaccountingservices.
ReviewoftheLiterature
Twotypesofliteraturemotivatedthis
study: (a) the academic stream, which
rangesfromforensicaccountingcourse
coverage to course identification and
recommendation, and (b) the practitioner stream, which suggests the skills
that forensic accountants use in practice.Accordingtothe2006Association
332
JournalofEducationforBusiness
of Certified Fraud Examiners’ Report
to the Nation on Occupational Fraud
and Abuse, fraud costs companies in
theUnitedStates$652billionannually.
Thisstatisticemphasizestheimportance
offorensicaccountingeducation.
GroomerandHeinz(1994)foundthat
fraud-relatedtopicsweretaughtinmore
than31%ofexaminedinternalauditing
courses.Rezaee,Reinstein,andLander
(1996)foundthatfewuniversitiesoffer
a fraud or forensic accounting course.
Rezaee and Burtin (1997) concluded
that the demand for forensic accounting services will continue to increase.
In addition, Rezaee and Burtin found
that the academics and certified fraud
examiners differed in opinion of how
forensic accounting courses should be
offered. Academics preferred to integrate forensic accounting topics in the
existing accounting courses, whereas
the certified fraud examiners preferred
offeringaseparatecourse.Buckhoffand
Schrader (2000) examined the extent
to which academic institutions across
the United States are offering forensic
accounting courses. They found that,
on average, universities considered it
moderately important to add forensic
accounting to their curriculum. PetersonandReider(2001)reviewedcourse
syllabi of universities offering forensic
accounting courses and examined the
levelofthecourse,learningobjectives,
and course requirements. Their findingsindicatedthataccountingeducators
agreethatthereisaneedforuniversities
to provide forensic accounting education.Rezaee(2002)examinedasample
ofundergraduateandgraduateaccounting students, and the results indicated
that the students believed that forensic
accountingisaviablecareeroptionbut
isnotgettingtheproperattentionincollegesanduniversities.
The National Institute of Justice
(2005) prepared a model curriculum
guide for education and training in
fraud and forensic accounting to aid
academic institutions, public and private organizations, practitioners, faculty, and prospective students. Rezaee
etal.(2006)surveyedopinionsofpractitioners and academics regarding the
importance, relevance, and delivery of
forensic accounting education. Their
resultsindicatedthatthedemandforand
interestinforensicaccountingwillcontinuetoincrease.Bothpractitionersand
academicsviewedaccountingeducation
asrelevantandbeneficialtoaccounting
students. However, the groups differed
in opinions regarding topical coverage
offorensicaccounting.
Harris and Brown (2000) have identified specialized skills and technical
abilitiesofforensicaccountants.Forensicaccountantsareusuallyfamiliarwith
criminal and civil law and understand
courtroom procedures and expectations. Those researchers also stressed
investigative skills, including theories,
methods, and patterns of fraud abuse.
Forensicaccountantsthinkcreativelyto
considerandunderstandthetacticsthat
a fraud perpetrator may use to commit
and conceal fraudulent acts. Additionally,theyneedtoclearlyandconcisely
communicate findings to various parties, including those with less knowledgeofaccountingandauditing.Grippo
andIbex(2003)illustratedthatthemost
importantskillsofforensicaccountants
comefromexperienceinaccountingand
auditing, taxation, business operations,
management,internalcontrols,interpersonalrelationships,andcommunication.
Messmer (2004) stated that successful
forensicaccountantsmusthaveanalytical abilities, strong written and verbal
communication skills, a creative mindset,andbusinessacumen.Theymustbe
abletointerviewandelicitinformation
from potentially uncooperative people
andpossessastrongamountofskepticism.Ramaswamy(2005)believedthat
forensic accountants are distinctively
positioned to be able to uncover financial deceptions, their prominent skills
being an in-depth knowledge of financial statements, the ability to critically
analyze them, and a thorough understandingoffraudschemes.Ramaswamy
also believed that forensic accountants
should have the ability to comprehend
theinternalcontrolsystemsofcorporations and be able to assess their risks.
Last, knowledge of psychology helps
forensic accountants to understand the
impulses behind criminal behavior that
motivateandencouragefinancialdeception.Also,(a)interpersonalandcommunicationskillsthataidindisseminating
informationaboutthecompany’sethics
and (b) an understanding of criminal
Downloaded by [Universitas Maritim Raja Ali Haji] at 23:15 11 January 2016
and civil law and of the legal system
andcourtproceduresareskillsthataid
forensicaccountants.
The academic literature identifies
forensic accounting courses and content, whereas the practitioner literature
suggests skills necessary in practice.
However, the literatures have not yet
empiricallyidentifiedtheviewsofthree
major stakeholders—accounting academics, forensic accounting practitioners, and users of forensic accounting
services—regarding which skills are
importantforforensicaccountants.
The three aforementioned stakeholders will be significant in shaping the future of forensic accounting.
Accounting academics will educate
futurestudentswhowillbecomeforensic accountants; the practitioners must
be competent in their practice; and the
users (attorneys) have the potential to
structure changes in forensic accountingasthemarketfortheseservicesare
dictatedthroughcaselaw.
The present study adds the necessary incremental contribution to the
literature that identifies relevant skills
of forensic accountants and whether
any differences exist in the views of
thoseskillsamongthethreesignificant
stakeholders. In light of the growing
importance of forensic accounting in
the business environment, this study
provides useful information for faculty
members and universities working to
implement forensic accounting educationintheircurriculum.Asthisthriving
area of accounting continues to evolve
it will be necessary to ensure that the
correct skill set results from forensic
accountingeducation.
METHOD
I conducted a nationwide survey on
a random sample of 1,500 accounting
academics, forensic accounting practitioners, and users of forensic accounting services. For this study, I classified
attorneys as the primary users of forensic accounting services. The sample
wascompiledasfollows:Iretrieved(a)
500 random e-mail addresses of faculty members from accounting departments of various universities across the
nation;(b)500randome-mailaddresses
offorensicaccountingpractitionersfrom
several membership databases—the
NationalAssociationofCertifiedValuationAnalyst(NACVA),AmericanBoard
of Forensic Accounting (ABFA), Association of Certified Fraud Examiners
(ACFE), and the American Institute of
Certified Public Accountants (AICPA)
businessvaluationandforensicandlitigation services section (BVFLS)—and
(c) 500 random e-mail addresses from
a Google search of attorneys practicing
commercial litigation, matrimonial law,
and damages. These types of attorneys
oftenuseforensicaccountantsforarange
of damage, valuation, and fraud cases.
Thelikelihoodthatanattorneywhopractices commercial litigation, matrimonial
law,anddamagesdoesnotuseaforensic
accountant is slim because these types
of attorneys are the focus of marketing
efforts for accounting firms providing
forensicaccountingservices.
I prepared, pretested, and e-mailed
the survey instrument (see the Appendix). Participants were e-mailed using
http://www.surveymonkey.comandwere
asked the extent to which they agreed
withstatementsaddressingeachofnine
competenciesthatweredeemedbyprior
literature to be important skills of a
forensic accountant.The agreement ratingsweremadeona5-pointLikertscale
ranging from 0 (strongly disagree) to 4
(stronglyagree).
Initially,Icomputeddescriptivestatistics for group membership (frequencies
andpercentages)aswellastheresponses
relatedtotheninecompetencies(bothpercentages within each category and overall means and standard deviations). The
correlations among the nine items were
also computed. A principal component
analysis was then performed to examine the underlying structure of the nine
items. The eigenvalues-greater-than-one
rule was used to determine the number
ofcomponentstoextractandrotate.The
eigenvalues-greater-than-one rule states
thatthenumberoffactorstobeextracted
shouldbeequaltothenumberoffactors
having an eigenvalue (variance) greater
than 1. The rationale for choosing this
particularvalueisthatafactormusthave
varianceatleastaslargeasthatofasingle
standardizedoriginalvariable.Descriptive
statistics (ranges, means, standard deviations, and internal consistency reliability
coefficients)werethencomputedforthe
compositescoresresultingfromtheprincipalcomponentanalysis.
I used two-tailed tests and a Cronbach’s α level of .05 for all inferential
analyses.Themainsetofanalysesconsistedofaseriesofone-wayanalysesof
variances(ANOVAs)comparingpractitioners, academics, and users in terms
oftheirratingsoftheimportanceofthe
ninecompetencies.WhentheANOVAs
were statistically significant, follow-up
tests were performed by usingTukey’s
HSD. An alternative set of analyses
was performed by using nonparametricKruskal-Wallisteststocomparethe
importance ratings of the three groups.
InadditiontotheANOVAsandKruskal-
Wallistestsperformedontheindividual
items, similar procedures were used to
compare the three groups on the compositescores.
RESULTS
ItemDescriptiveStatistics
Atotalof252individualscompleted
thesurvey.Ofthese,102(40.5%)were
practitioners, 72 (28.6%) were users,
and 78 (31.0%) were academicians.
The overall response rate was 16.80%.
Descriptive statistics for the nine areas
of competency are shown in Table
1, including the percentage in each
responsecategoryandtheoverallmeans
andstandarddeviations.Theitemsrated
asmostimportantwerecriticalthinking
(M=3.63,SD=0.67),deductiveanalysis (M = 3.60, SD = 0.66), and written
communication(M=3.55,SD=0.61).
Theitemsratedasleastimportantwere
specificlegalknowledge(M=2.96,SD
= 0.86), composure (M = 3.29, SD =
0.67),andunstructuredproblemsolving
(M=3.34,SD=0.89).
The correlations among the importanceratingsfortheninecompetencies
are shown inTable 2.The highest correlations were between oral communication and written communication (r
= .73) and between deductive analysis
andcriticalthinking(r=.69),whereas
the lowest were between unstructured
problem solving and oral communication(r=.24)andbetweenunstructured
problemsolvingandwrittencommunication (r = .30). All correlations were
statisticallysignificant(p