And The Survey Says... Increasing Demand for Forensic Accounting
Infographics may be the rage these days, but I still like good old-fashioned statistics, data points and most of all, survey results. Maybe it's because I spent a lot of time watching Family Feud as a child, but when I look at survey results the voice in my head announces ‘and the survey says…’
If 100 CPAs across the country were asked ‘what is the fastest growing area in accounting,’ it is highly likely that forensic accounting would be one of their top answers. Backing up what many in the profession have long suspected to be true are the latest results from the AICPA Forensic and Valuation Services Trend Survey: and the survey says that forensic accountants are seeing a noticeable increase in demand for their services.
Forensic accounting services generally involve the application of specialized knowledge and investigative skills possessed by CPAs to collect, analyze and evaluate evidential matter and to interpret and communicate findings in the courtroom, boardroom or other legal/administrative venue. Professionals specializing in forensic accounting provide services to their clients, who are often attorneys and businesses across an array of industries.
Forty-seven percent of respondents saw an increase in the hours spent working on forensic accounting, compared with only 14 percent who said their hours decreased. The areas with the greatest jumps in demand within the past year included shareholder/partner disputes, contractual disputes, family law, and gift and estate issues.
And this was not just statistical noise or a random variance―CPAs expect to see increasing demand for their forensic services for the next two to five years, largely as a result of increased litigation and regulatory enforcement. The specific areas they expect to be spending more time on are shareholder/partner disputes, contractual disputes and family law. Additionally, as economic uncertainty and instability persist, respondents indicated they expect an increase in time spent working on bankruptcy, insolvency and reorganization.
This is good news for CPAs and those studying to become accountants: with an increase in demand comes an increase in jobs. In fact, one-quarter of respondents reported hiring more professionals over the past year. The AICPA also surveyed professionals in business and industry on their planned usage of forensic accountants, with 54 percent saying that their companies would increase their use of outside consultants versus in-house personnel in the next two to five years
For firms, the findings indicate that the recruitment, retention and continuing education of their professionals is going to be an ongoing priority, given the need to manage and execute an expanding workload. Succession will be a key concern for many forensic and valuation practices. As leaders who have built practices pass the reins to a new generation, younger professionals will need a combination of technical, practice development and leadership abilities.
For more information and resources on this fast growing area, visit the AICPA Forensic and Valuation Services Section.