When a part-owner of a successful food manufacturer in the UK was being forced out of the company against her will, she came straight to H & H Associates.
The motivation was simple – she knew she could rely on our forensic accounting experts and highly-trained financial fraud investigators to help her uncover any fraudulent activities that might have happened behind her back.
Difference between regular accounting and forensic accounting
Accounting, be it general financial, tax, cost or in other forms, is a systematic process of classifying, recording and communicating financial data to interested parties including management, investors, creditors and regulators. Suffice to say, all accountants look at numbers and use them to calculate profit or loss of a given period and use assets and liabilities to determine the value of a company through its balance sheet. The numbers give interested parties a snapshot of a company’s financial health and long-term viability.
Forensic accounting, on the other hand, goes beyond looking at numbers and analysing the performance of a company. Instead, forensic accountants work to identify business practices that may look ordinary but are carried out with the intention to deceive and commit fraud.
The word ‘forensic’ is the key differentiator here. It means using specific accounting and auditing procedures to uncover evidence in such a way that it can be used in a court of law. This means you, the victim of fraud, can pursue litigation if necessary as you are equipped with concrete evidence that shows defraudment has taken place in a concise and indisputable way.
H & H Associates’ forensic accountants to the rescue
Under the UK’s Fraud Act 2006, the government attempts to categorically define fraud in all its iterations and threatens those found guilty of fraud with a maximum sentence of 10 years if indicted for an offence. The United States has a similar piece of legislation in effect. Known as the Fraud Enforcement and Recovery Act 2009, it similarly attempts to outline the ramifications of fraud offences and illuminates sentencing as a substantial deterrent. However, the law still doesn’t deter fraudsters from committing the crime.
Fraud is often driven by greed and where individuals have an opportunity, they may eventually take advantage of it. In the case involving the food manufacturer, our trained and experienced forensic accountants have successfully uncovered that the other owner was consistently defrauding the company through a series of fund misappropriations and in a desperate attempt to cover-up the wrongdoings, they decided to push our client out and bar her from accessing critical business information. You can read more about this case by clicking on this post “A food manufacturer requiring forensic accounting help case study”.
Although forensic accounting is especially useful when dealing with fraud, they are also pivotal in several areas including:
When mergers and acquisitions go wrong
When warranties or expectations are not met
In bankruptcy and insolvency cases
In fraud and embezzlement cases
During company valuations
During professional negligence claims
In ascertaining economic damage through contract breaches
Whether you’re a large company with offices all over the world or a small local business, the forensic accounting team at H & H Associates can help you get to the bottom of any issue you may have when the numbers just don’t add up.
We believe that you should always trust your instincts. If you suspect that someone in your business is involved in fraudulent acts, contact us straight away. The earlier you act, the more chance we have of protecting your business and catching the culprit before too much damage is done.