Why You Need A Mnangement Accountant

 Though there may be many profession on earth, but the accounting profession is one of the best if not the best on earth. In the midst of the variety of commerce job that one can decide from, one field can offer an unusual grouping of constancy, status, money, and enthusiasm which  is accounting. The accountants are more complicated and more educated; they  use the modern strategy and the technology for the business field. The jobs after completion of the accounting degrees are more than any other like the keeping of financial records in the order individually managed. It is a profession that offers different areas of specialization one of which is management accounting.

Management accounting is an internal accounting method used by managers of firms in order to help them make informed decisions about the business they are managing. It is for internal use in a company and is confidential, unlike financial accounting which is for external users. Looking toward the future, it is used to determine how profitability for a company can be improved based on the data obtained. Versus complying with the standards of accounting, such as the GAAP (Generally Accepted Accounting Principles), which uses extensive and complex internal controls as well as controlling information systems which are computed pragmatically.

Proper decision-making for a company requires managers to use internal information obtained by these accounting to improve a company's performance. Accountability in this area is important, and because of the emphasis on the use of a company's resources in order to improve a company's performance as well as save a company money, it creates a system for managers to rely on. It is the measurement, analysis, identification, accumulation, interpretation, preparation and communication of information that managers use to control, plan and evaluate the proper use of a company's resources. It also prepares the external financial reports.

Management accounting includes 3 primary areas: Performance, Strategic and Risk area. It is responsible for the measurement, identification, reporting and management of risks as a major contributory factor to the framework of a company. Strategic management helps them to advance in their role as a partner of strategy in that company. The Performance one requires the practice of decision-making in business and the ability to manage the performance of a company.

It apply their skill and knowledge to financial documents in order to provide managers with the necessary information to make informed decisions on the future of a company's performance. They are vital to a manager's ability to create policies as well as control and plan strategies necessary to improve a company's profitability. It creates value in a company out of production and their forward outlook helps a company to evolve into a well functioning and well managed machine. The historic aspects of costs and recording are not as important to a management accountant as looking toward the future is because that kind of data does not help to determine a company's future profitability as well.

Executive level pay is based upon company performance. If the performance of a company is not reported in a proper manner, executives make money that far exceeds what the business is capable of and creates a false picture of a company's performance. This false reporting causes the stock market to balloon by rewarding stock to companies who do not deserve it, and these methods have a bad effect on our economy. Business accounting that honor the GAAP (Generally Accepted Accounting Practices) creates a transparent personal, an air of trust and respect, from the users of their financial statements.

Using Peachtree Accounting Software

Over the years software have been developed to ease the recording of financial transactions of which Peachtree accounting software is the most widely used software. Peachtree software is an accounting system in which small businesses can manage their books. It takes a more difficult and complex process and reconstructs it into a simple process that anyone can use. By following the instructions provided, one will be able to set up their company in Peachtree, make their journal entries, and view the financial statements that the software creates.

It benefits any company to use the Peachtree software because it provides accuracy that manual bookkeeping cannot. The software ensures that proper journal entries are made and that all accounts balance. The use of Peachtree requires basic computer skills; however, one must be knowledgeable in accounting to make the proper journal entries. All steps in the instructions are necessary and must be followed completely.

Tools Needed

• ·        Computer

• ·        Peachtree Software

Establishing your company

• ·        Open Peachtree Complete Accounting. On the start-up screen, click “set up a new company.”

• ·        Click “next” on the first screen presented.

• ·         Fill in the company’s information and then click “next.”

• ·        Leave the default and click “next.”

• ·         Scroll through and select a comparable industry and click “next.”

• ·        Choose the accounting method the company currently uses and click “next.”

• ·        Select the way the company would like to post the journal entries and click “next.”

• ·        Identify 12 month accounting periods and click “next.”

• ·        Choose the month that the company’s year-end will begin and end on click “next.”

• ·        Use the default on this screen and click “next.”

• ·        Change to “No, I do not need the Setup Checklist,” and click “finish.”

Protect your files

• ·        Select the maintain tab, then users

• ·        Set up a user name and password, click “save.”

Creating your journal entries

• ·        Select the tasks tab, then general journal entry.

• ·         Select the date on which the journal entry is to be made. At any point during creating journal entries, the date can be changed to represent various entries on various days, but the entries must be saved before changing to a different date.

• ·         Under account number, click on the magnifying glass and choose the account to debit, then create a description and dollar amount in the proper fields.

• ·        Complete step 16 again, except for the account to be credited.

• ·         Repeat steps 16 and 17 until all journal entries are made for that day and any other days. .

• ·        Click “save” at the top of the screen after each journal entry.

• ·        Once the journal entries are complete, go the tasks, then system, then post. Click “all journals,” and then “OK.”

The finished product

• ·        Go to reports, then general ledger. Double click “general journal” to view the list of journal entries.

• ·        Go to reports, then financial statements. Double click on the financial statement to view it.

Congratulations, the process is now complete. The finished product includes an established company in the Peachtree software, journal entries, and current financial statements. Continue to make use of the Peachtree software by creating entries as they occur. Remember to post all entries at the end of each day. Good luck with the continued use of Peachtree software, hopefully it will meet all of the financial needs of the company.

Pursuing A Career In Forensic Accounting

Forensic accountants are financial detectives who audit, investigate and ascertain the accuracy of financial reporting documents, often in connection with anticipated or on-going legal action. They are charged with ferreting out questionable financial data, chiefly for the purpose of investigating white-collar crime involving individuals as well as businesses of all sizes. They may work with businesses, non-profit organizations (including government and law-enforcement agencies), estates, individuals and others who require forensic-accounting services. Recent regulations have made forensic accountants widely sought after, and there are many career options available for those who are interested.

Forensic accountants may help with risk management and risk reduction through customized design of accounting and auditing systems and procedures. As a function of due diligence and investment analysis, they will advise on a wide variety of financial transactions:

• ·         Contemplated mergers and acquisitions

• ·         Venture capital investments

• ·         The purchase of corporate bonds, commercial paper and stocks

• ·         Bankruptcy proceedings etc.

The criminal activity uncovered may include fraud, embezzlement, money laundering, the concealment of debt, the concealment of assets or other fraudulent activities, or even financial crimes. Forensic accountants may be called upon to testify in court as expert witnesses in criminal and civil litigation and appear in pre-trial depositions. Beyond their typical work in the business sector and the investigation of individuals' assets for various legal purposes, forensic accountants may also examine criminal enterprises to recover illegally obtained money or spot money laundering. In a government confiscation of assets in organized-crime cases, or in tax cases against individuals or companies, the work of a forensic accountant is indispensable.

Forensic accountants are also often Certified Public Accountants and Certified Fraud Examiners (CFE) as a Certified Fraud Examiner is a specialist with extensive training in the prevention and deterrence of fraud and is required to pass a 500-question examination for certification that covers topics such as fraud examination and investigation techniques, financial transactions, criminology and ethics, and legal elements of fraud. Requirements for certification also include high moral character and strict professional and academic standards. The CFE credential is conferred by the Association of Certified Fraud Examiners. The certification is recognized worldwide, and employers look for it when forensic accounting is needed in this area. Although in Nigeria the Institute Chatered Accountants On Nigeria (ICAN) have incorporated forensic investigation as one of their departments which makes it a recognized body for Nigerians willing to become a forensic accountant although they are presently few forensic accountants in the country yet there are opportunities to be explored in this area.

Both the forensic accountant and the CFE must have a comprehensive understanding of business information and all aspects of financial reporting.

BECOMING A FORENSIC ACCOUNTANT

Forensic accountants are required to have a bachelor's degree in any field but most importantly accounting. Employment opportunities and career advancement may be enhanced with a master's degree in accounting or in any of the business sciences. Entering the field of forensic accounting as a Certified Public Accountant is an additional advantage. As an adjunct to forensic accounting, career-minded accountants may also become a Certified Fraud Examiner. The CFE credential requires a course of study and an examination.

Courses in forensic accounting are offered at many colleges and universities, other private institutions and through online educational programs. Scholarships, grants and subsidies for the education and training of forensic accountants are available from governmental and private sources but in Nigeria only UNIBEN is offering the course at masters’ level as most Nigerian universities are yet to incorporate the course.

In conclusion Forensic accounting can be a fascinating, satisfying and well-compensated career. The field is expanding, and there are numerous job opportunities in the private sector, government and other non-profit organizations. The work is beneficial to the community, and the profession is highly respected.

An Overview of Forensic Accounting

Although it has gained widespread recognition in recent years, the term “forensic accounting” is generally not well understood by the layperson. While many believe it is related to the investigation of white collar crime, it still remains somewhat of a mystery to  many as  I hope to demystify forensic accounting by providing a brief history, discussing common misconceptions, and the application of forensic accounting in modern times.

There is a misconception that the term “forensics” relates to medical examinations of crimes. Actually, the term “forensics” originated from the Greeks, who organized public debates and contests for speakers. These contests were labelled “for ensis,” which is the Latin term for “public forum.” The plethora of recent white collar crimes has brought the term “forensic accounting” to the mainstream. However, some historians suggest that the word “forensics” entered the English language in the 1600s, and some trace the origins of forensic accounting to a court case in 1817 (Meyer v. Sefton) in which an accounting expert witness was called upon to testify in a bankruptcy case. Seven years later, a chartered accountant in Scotland, James McClelland, was probably the first to hold himself out as a forensic accountant. Although he did not use the term “forensic accountant,” he advertised that his practice provided accounting services on disputed accounts that can be used in court. In the United States, the term “forensic accounting” was not developed until 1946. However, the FBI and IRS used forensic accounting techniques as early as 1931 in connection with the investigation of Al Capone. With all of the law enforcement officers investigating Mr. Capone, it ultimately took a forensic accountant named Elmer Irey to bring him to justice. Today, the term “forensics” refers to evidence that is “suitable for use in a court of law.” Consequently, the forensic accountant must undertake the investigation of the financial and accounting evidence with the anticipation that the work product will be used in litigation.

Forensic accounting, therefore, is the integration of accounting, auditing, business acumen, and investigative experience to provide a financial analysis and conclusion that may be suitable for use in a court of law. In addition to possessing the standard financial skill sets of accountants, auditors, and fraud examiners, the forensic accountant must be familiar with legal concepts and procedures. Failure to do so may render the forensic accounting evidence unusable.

Another common misconception is that fraud investigation and forensic accounting are synonymous; they are not. In criminal law, fraud is defined as the intentional deception made for one’s personal gain or to damage another individual. Fraud is a civil violation and a crime. Therefore, a fraud investigation is the investigation of a crime. A fraud investigation may or may not involve the use of forensic accounting techniques. In the case of certain types of corruption, such as the acceptance of illegal gratuities, it may not be necessary to employ forensic accounting techniques; the mere observation of the acceptance of the illegal gratuity may be sufficient. In other cases, such as embezzlement, the fraud investigator would likely use forensic accounting Techniques extensively.

On the other hand, in forensic accounting engagements, fraud may or may not be present. In the case of embezzlement, it is clearly involved. However, in commercial litigation, fraud may not be an issue. For example, two parties to a contract may have a disagreement over the appropriateness of financial calculations, or the interpretation of accounting records. The forensic accountant is not engaged to uncover fraud, but to render an opinion on the interpretation of financial calculations or accounting records. Consequently, the terms “fraud investigation” and “forensic accounting” should not be used interchangeably. Not all fraud investigations involve the use of forensic accounting techniques, and not all forensic accounting engagements involve allegations of fraud.

Another distinction worth examining is the comparison of a conventional financial statement audit to a forensic accounting investigation. The purpose of an audit is to render an opinion on the fairness of financial statements, and to make process improvement recommendations to the auditee. There is a healthy level of professional scepticism, but the working relationship is generally not adversarial. The forensic accountant’s job is to get the facts, find out what happened, and gather evidence.

 There is a heightened level of professional scepticism, and the working relationship is clearly more adversarial. The forensic accountant, unlike the traditional accountant, is trained to gather and preserve evidence that can be used in litigation. In addition, he must be prepared to testify under oath. A final misconception is that forensic accounting is focused solely on white collar crime. Although forensic accountants are often involved in investigations of asset misappropriation, they are also engaged in many other services including the following:

• Shareholders’ and partnership disputes

• Business interruption and other insurance claims

• Matrimonial disputes

• Business economic losses

• Tax controversies

• Professional negligence

• Fraudulent financial reporting

• Financial analysis

• Mergers and acquisitions

• Discovery assistance

Once you have determined that you require the services of a forensic accountant, there are several factors to consider before selecting one. To start, you will want to examine a potential forensic accountant's credentials. Ideally, he or she will be a CPA with at least one other forensic/fraud related credential. Some of the credentials you should look for include Certified Fraud Examiner, Certified Forensic Accountant and Certified in Financial Forensics. You will also want to make sure your forensic accountant is highly experienced. While a person with one or two years of experience is fine for performing certain accounting or auditing functions, they lack the street smarts and heightened level of professional scepticism required to look beyond the numbers and evaluate substance over form. They also lack the ability to recognize nonverbal signs during interviews that may indicate deception.

 Finally, a forensic accountant can bring a number of resources to the table. Most forensic accounting engagements require a wide range of skills and expertise examples are :

·        Forensic Accounting Services

·        Misappropriation and diversion of assets

·        Employee fraud and embezzlement

·        Business interruption and insurance claims

·        Reconstruction of financial records

·        Special accounting investigations

·        Review of corporate transactions

·        Fraudulent financial reporting

·        Discovery assistance

·        Calculation of damages

·        Expert testimony

·        Trial preparation services

·        Financial Analysis

·        Rebuttal advisory

·        Mitigation assessment

·        Mergers and acquisitions

In conclusion the need for forensic accountants can’t be over emphasised in today’s world where corruption is the order of the day as they aid in curbing this menace to a large extent.