To understand why your business needs forensic accounting, you have to first know what forensic accounting is. It is the practice of using different accounting techniques to analyze and find solutions for legal problems. In case of a fraud or money embezzlement, a forensic accountant comes to play to investigate the case. Most of the time, this is what they do; however, they also provide litigation for attorneys and police officers. Now that we have gotten that out of the way, let’s see why your business needs a forensic accountant. Listed below are several of the most important reasons.
You need a valuation of your business
Thinking about selling your family business and need someone to properly estimate its worth? Get in touch with a forensic accountant, and they will do it for you. They are the best at this field, and will do it quickly and effectively. Believe it or not, but most real estate agents do their job poorly compared to accountants. Besides, if you are looking to get an actual price or the most accurate one for your business, you should hire a forensic accountant.
You think of buying another business and want to investigate
Most of the time, people sell a business for two reasons: One is retirement, the other is bankruptcy. Rarely there is a third reason, which is a change of heart, the need for money injection to start off another business. If you are looking to expand your business and want to hear the real story about the business you are about to buy, hire forensic accountants to get to the bottom of it. They will discover the real story behind finances and the true reason why the business is being sold. Also, they can help you find out everything concerning the finances, from monthly income to estimated yearly profit.
Your supplier has been overcharging you for the products
In case you run a company, you know how important it is to have a reliable supplier who delivers on schedule and at fair price. However, there are still many ways one can steal money from you and your business, like for instance overcharging you for the products delivered. If you suspect anything similar, make sure you call a forensic accounting department. They will thoroughly investigate the case and ensure that everything is in the best working order. In case they find something fishy, you will be notified and extreme measure will be taken against your supplier and every third party involved in the process.
Managers are squandering money
Another similar case of theft is when your manager steals from you. Having someone squander money on a daily basis is a serious felony, and it costs your business a small fortune over time. If you ever suspect anything, you need to involve a forensic accountant into it to check things out. They will do everything in their power to check every bill, every record, and every fare and take everything into account to find even a missing dollar. If your manager is stealing from you, you will know it.
Your accountant/bookkeeper steals from you
If you have any doubts about the money missing or your current bookkeeper stealing from you, call a forensic accounting team and let them take care of the situation. Again, they will get to the bottom of the situation and find out if your accountant has been stealing from you. Once they do a full financial check, they will deliver you a report where you will be able to compare everything with the results obtained from your accountant. If you find anything missing, you know what to do.
Forensic accounting is very useful for your business. There are plenty of other reasons why your business needs it, and the ones listed above are just some of the examples of the things forensic accounts are capable of.