Forensic Accounting Examination: Procedure

Forensic accounting expertise - a study aimed at identifying circumstances in a civil or criminal case. The key regulatory documents governing its implementation are the Civil Code, Administrative Code, Code of Criminal Procedure, Federal Law No. 73. Let us further consider what constitutes the production of accounting expertise.

Subjects of law

The appointment of forensic accounting expertise is allowed by authorized bodies and persons. The scope of the research is limited only to those operations of economic activity that are of interest in the investigation. The prosecutor can initiate the examination, inquiry bodies either court. Specialists from government agencies or private individuals may be involved in the audit. The latter must have the appropriate qualification level and pass certification in the manner prescribed by law.

Appointment of accounting expertise

If it becomes necessary to carry out an inspection, authorized entities are guided by Art. 184 Code of Criminal Procedure. Part 1 of the indicated norm establishes that, as part of the investigative process, a decision is made to conduct an examination. It defines:

1. Reasons for verification.
2. The specialist responsible for the accounting expertise.
3. Issues for which an opinion is needed.
4. Research materials.

Authorized bodies may contact a specialist solely on issues raised as part of the examination.

Important point

In Art. 67 of the CPC provides for a restriction on the participation of an expert in the study. In particular, a specialist cannot fulfill it if there is a personal interest in the result. The expert’s participation in the study is also not allowed when he is in any (kindred, official, etc.) dependence on the defendant or plaintiff.

Tasks

Conducting a forensic accounting examination involves a study of the materials provided to the specialist: registers, statements and other documents. His task is to identify distorting facts, method, place, time of their appearance. The resolution of the forensic accounting expertise includes the assessment of a specialist on the interconnectedness of business operations. Researchers are also given the following tasks:

1. Detection of signs of distortion of accounting information that affect the performance of the subject.
2. Recreating Records.
3. Search for inconsistencies in the data provided.
4. Identification of double counting.
5. Reflection of the facts of theft.
6. Justification of targeted spending.
7. Assessment of the completeness of the adoption of material values.
8. Establishing the correct reflection of operations.
9. Identification of signs of falsification of documentation, tax evasion.

Study materials

Financial and accounting expertise involves the study of documents, the composition of which depends on which records are in doubt among authorized persons. At the same time, the latter may request both copies and original papers. This issue is regulated by the Federal Law "On Accounting". When originals are seized, the investigating authorities draw up a protocol. When performing the inspection, the specialist must make sure that the materials that were transferred to him were received in accordance with the specified act.

Verification Objectives

Forensic accounting expertise allows you to find dubious documents. In this case, the specialist pays attention primarily to the technical content of the papers.He verifies the authenticity of signatures and seals, compliance with the numbering of interrelated documents, compliance with the design. The expert also identifies the information connection between the papers. In particular, he checks the availability of a cash register’s cash order for issuing funds, orders, expense reports and so forth

The conclusion of accounting expertise

It is compiled after a full, comprehensive verification of the materials provided. The conclusion is made in writing. It sets out the answers to the questions posed to the specialist, provides their rationale. The conclusion consists of several parts. The introductory section provides a brief description of the circumstances of the case. It also indicates information about the specialist who performed the accounting examination, the authority that initiated it, the materials that were examined. In the second - research - part, there is a description of the process itself. In this section, the specialist outlines the methods that he used in the evaluation, indicates background information, describes investigative experiments (if they were performed). The last part provides conclusions. Answers to questions posed to a specialist should be precisely worded, excluding a double interpretation. The act is drawn up in duplicate. One specialist retains, the second passes to the initiator of the test.

Additionally

If necessary, the specialist who performed the accounting examination may be called to a meeting. In some cases, additional clarification of the opinion indicated in the final act of verification is required. It should be noted that the outcome of the proceedings may depend on how the specialist conveys the meaning of the provisions of his conclusion. Due to the fact that the final act is based on the special knowledge of the researcher, this document can act as a source of indirect or direct evidence in accordance with the specific circumstances of the case. When making a decision, the court is obliged to assess the coherence of the provided conclusion with other materials, the objectivity of the facts cited, compliance with the standards during the examination, the correctness of the chosen methodology and other nuances. If the conclusions are incomplete or unclear, a specialist can be called to a meeting or an authorized authority can initiate a second study. The court may or may not accept the expert’s arguments when making the decision. However, in any case, he must motivate his actions.

Special cases

As practice shows, often the claims of tax authorities on payers to pay off arrears are unreasonable. Meanwhile, the verification act, which is drawn up by the control service on the fact of revealing evasion of making mandatory payments to the budget in a particularly large amount, leads not only to financial losses, but also to criminal liability. In such cases, it is imperative for the subject to prove his innocence before initiating proceedings. This can help accounting expertise. An attentive worker already during the inspection understands the illegality of the claims of the control body. In such situations, it is advisable to involve a third-party expert. He will check the correctness of accrual and establish the fact of timely repayment of the obligation to the budget. In this case, it is important to correctly formulate the questions that the specialist will answer.

Recommendations

It should also be borne in mind that legislation devotes to pre-trial settlement of a dispute not much time, and the tax authority, as a rule, is not inclined to discuss the validity of its claims. Accordingly, the possibility of resolving the matter before the start of the trial in the first instance is significantly reduced.In this regard, after receiving the act of the tax authority, a lawsuit should be filed to declare it invalid by attaching an expert opinion.

Procedure specifics

Accounting expertise has a number of features. First of all, the procedure differs in the procedural legal form. It provides a source confirming the investigated facts of economic activity. In addition, when performing the study, special knowledge in the field of accounting is used. These features must be taken into account by authorized persons initiating the audit when determining the subject of study. The specificity of the procedure is of no small importance directly during the execution of the final act of research acting as a source of evidence. Despite the fact that the audit acts as a procedural form, its content and essence must be considered not from a legal position, but within the framework of accounting science.

Key principles

The implementation of the accounting expertise is based on the prerequisites of objectivity of reflection in the reporting documents of any offenses that are committed in the course of or under the guise of legitimate business transactions. The result of such actions is a set of signs of illegal facts. They are identified in the process of research of accounting and economic information. These signs are substantiated and classified in the expert opinion.

Subject of study

The essence of accounting expertise is considered in two aspects: practical and scientific. Such a division made it possible to develop a conceptual apparatus of research corresponding to the current economic situation. Based on this, several approaches to determining the subject of accounting expertise are highlighted:

1. Object-based - depends on the objects of study.
2. Result - is determined in accordance with the number of checkpoints detected.
3. Forensic (tax) - depends on the volume and severity of material consequences and the content of the relevant norms of the Criminal Code and the Tax Code.

The subject of examination is a process of identifying and investigating facts of unreliable, distorted reflection of assets, liabilities, income, equity, costs, business transactions and their results in the financial reporting and accounting system. These circumstances act as objects of investigation. In relation to them, the expert draws up a conclusion, answering questions posed by law enforcement or other authorized bodies, owners, shareholders.

findings

Accounting expertise is a specific process of checking reporting documentation. Its implementation requires the presence of certain knowledge, qualifications and experience. Judicial or investigative authorities, requesting expertise, hold the specialist liable for identifying distorted, unreliable facts, as well as substantiating the findings. Meanwhile, verification can be carried out outside the proceedings or investigations. She acts as a third-party objective study of the legality of ongoing business operations. In this case, it is initiated by the shareholders of the company or its owners.

In any situation, the accounting expertise should be carried out by competent authorities or persons. In the framework of the proceedings, the specialist must fully and clearly answer only the questions posed to him. If he is called to a meeting, the court does not have the right to ask questions that are not within his competence. In this situation, a specialist can give explanations on specific areas within the framework of his knowledge. Accounting expertise is of particular importance in the pre-trial settlement of disputes. In some cases, taxpayers manage to resolve the situation with the help of independent specialists.However, even if it was not possible to resolve the dispute before the court, the expert’s conclusions will serve as the most important evidence of the person’s innocence.