Master’s Degree in Forensic Accounting
| Accounting.com Staff Modified on March 15, 2022
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Accountants who specialize in forensic accounting investigate financial crimes. By analyzing financial documents, forensic accountants uncover embezzlement, concealed assets, securities fraud, and other illegal financial transactions. Forensic accountants often work with law enforcement agencies to conduct criminal and civil investigations, and they may appear as expert witnesses during trials.
ACCOUNTANTS AND AUDITORS EARN A MEDIAN SALARY OF $70,500 A YEAR, WITH HIGHER SALARY POTENTIAL FOR EXPERIENCED PROFESSIONALS WHO HOLD A MASTER'S DEGREE.
Earning a master's in forensic accounting trains students to collect and interpret evidence of financial fraud. Master's programs in forensic accounting prepare graduates for positions with the FBI, Big Four accounting firms, and other government agencies.
Forensic accountants benefit from strong job growth and high salaries. The Bureau of Labor Statistics projects nearly 140,000 new accounting and auditing jobs will be created between 2016 and 2026, representing 10% growth in the field. Accountants and auditors earn a median salary of $70,500 a year, with higher salary potential for experienced professionals who hold a master's degree. Pursuing a forensic accounting master's degree helps professionals advance their careers and increase their earning potential.
Common Career Paths
With a master's in forensic accounting, graduates can pursue multiple career paths in forensic accounting. Below, we describe three common career paths for forensic accountants in greater detail.
Forensic accountants work in law enforcement to uncover illegal accounting practices, including securities fraud and fraudulent financial reporting. Both state and federal law enforcement agencies employ forensic accountants. Law enforcement forensic accountants may specialize in tax fraud, business fraud, or other financial irregularities, contributing to both criminal and civil cases. Forensic accountants conduct investigations into financial crimes, identify discrepancies in financial documents, and testify as expert witnesses in trials.
The salary potential for forensic accountants specializing in law enforcement varies depending on their law enforcement agency. The Association of Certified Fraud Examiners reports a median annual income of $93,000 for certified forensic accountants who work in law enforcement.
The government employs forensic accountants to uncover financial fraud, violations of financial regulations, and other fraudulent financial activities. Federal agencies like the Internal Revenue Service employ forensic accountants to analyze individual and business tax reports to identify concealed assets, tax code violations, and financial crimes in tax reporting. The Government Accountability Office, Department of Defense, and FBI also employ forensic accountants. In addition to federal government positions, state and local governments also hire forensic accountants to investigate financial fraud and apply financial regulations.
According to the Association of Certified Fraud Examiners, government forensic accountants who complete the certified fraud examiner credential earn a median salary of $98,000 per year. Individuals without this certification take home $90,000 annually.
Forensic accountants also work in financial services, including at major accounting firms. In these settings, forensic accountants uncover fraud and conduct forensic investigations. Other companies, including law enforcement agencies, insurance companies, and financial institutions, may hire financial services firms that provide forensic accounting services to conduct investigations. When businesses merge or acquire other businesses, they may hire a forensic accountant to assess an organization's financial health and uncover any suspected fraud.
The financial services industry pays some of the highest salaries in forensic accounting. Certified fraud examiners working for financial institutions earn a median salary of more than $120,000 per year, according to the Association of Certified Fraud Examiners.
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Master's in Forensic Accounting
While earning a master's degree in forensic accounting, graduate students build core competencies, complete the program's curriculum, and gain valuable skills for a career in forensic accounting. This section provides insight into what to expect from a graduate-level forensic accounting program.
What to Expect
Earning a master's in forensic accounting typically takes two years and requires 30-36 credits for full-time students. Graduate students who choose a part-time enrollment option often take longer than two years, while those on an accelerated path can earn their degree in as little as one year. The cost of an MS in forensic accounting varies depending on the institution type. In-state, public schools typically charge lower tuition rates, while private schools often charge the highest tuition. However, scholarships, grants, and fellowships can affect the final cost of a graduate degree in forensic accounting.
Prospective students must also choose between a traditional or online program. An on-campus program offers the opportunity to work with other graduate students and faculty members in person. Alternatively, online programs may appeal to students seeking a flexible option that allows them to work while earning their degree.
Forensic accounting master's programs strengthen several core competencies, including financial analysis, investigation, and computer forensics. These skills help graduates pursue top positions in the field.
- Financial Analysis: Forensic accountants rely on their financial analysis skills to investigate suspected financial fraud and build a case against a fraud suspect. During a master's in forensic accounting program , graduate students strengthen their financial analysis skills through advanced coursework in accounting, auditing, and financial document analysis to prepare for careers in forensic accounting.
- Auditing: The skills of an auditor overlap with those of a forensic accountant. During a graduate program, forensic accounting students complete advanced classes in auditing. They build their ability to review financial statements, identify errors in reporting, and investigate suspected fraud. Fraud examiners and forensic accountants both rely on strong auditing skills.
- Investigation: More than any other accounting field, forensic accountants must hold strong investigative skills. The ability to investigate suspected fraud and build evidence to support a legal case helps forensic accountants succeed in multiple industries. Graduate students strengthen their investigation skills by taking courses in asset theft fraud, fraudulent financial reporting, and cyber forensics.
- Litigation: Forensic accountants act as expert witnesses and legal consultants in trials, assist law enforcement agencies investigating financial fraud, and participate in the legal system through depositions during trials. A graduate program strengthens a fraud examiner's litigation experience through courses in expert witnessing.
- Computer Forensics: Modern financial fraud often involves complicated schemes that require strong computer forensic skills to uncover. Master's students strengthen their computer forensics skills by studying data analytic techniques, cyber forensics, and digital forensics. These skills help forensic accountants uncover financial fraud.
Master's students in forensic accounting complete courses related to topics like fraudulent financial reporting, cyber forensics, and expert witnessing. The specific classes vary depending on the program.
- Principles of Forensic Accounting: Graduate students study the foundational principles of financial accounting, including techniques like collecting, interpreting, and documenting evidence of financial fraud. This course examines investigative techniques for forensic examinations, common fraudulent schemes, and fraud prevention methods. Forensic accountants apply these skills while investigating financial fraud.
- Fraudulent Financial Reporting: Specialized courses in fraudulent financial reporting explore various methods and techniques used to uncover fraud through financial statement analysis. Unlike asset theft fraud, financial reporting fraud requires a strong understanding of accounting and reporting regulations. Graduate students learn about common methods of financial reporting fraud, including strategies for detecting and investigating fraud.
- Cyber Forensics: Courses on cyber forensics train students in computer forensic tools and other technologies required to recover data or analyze instances of cyber fraud. Graduate students study data analytics methods and the use of digital evidence in a legal setting. These tools help financial forensic investigators uncover financial fraud in the digital age.
- Advanced Auditing: Forensic accountants rely on their auditing skills to investigate potential financial fraud. Advanced auditing courses emphasize auditing theory, research on external auditing issues, and the economic function of audits. Students learn about securities regulations, malpractice, and professional standards for auditors.
- Expert Witnessing: Professional forensic accountants and fraud examiners testify in legal disputes that involve financial fraud, including securities fraud, marital disputes, and business disputes. Classes on expert witnessing train graduate students to act as strong witnesses and consulting experts for a legal dispute. Students learn to effectively communicate during a trial or deposition and the ethics of expert witnessing.
Prospective accounting graduate students should always check an institution's accreditation status before applying. Accreditation signals that schools and programs meet high standards for academic excellence. To earn institutional accreditation, colleges and universities submit to a voluntary review from an independent, nonprofit accrediting agency. During the review, the accrediting agency measures variables like an institution's graduation requirements, student learning outcomes, and graduation rates to ensure they meet high standards. Colleges and universities that earn accreditation must submit to periodic reviews to maintain their status.
Regional and national accreditation are institutional levels of accreditation. These apply to an entire college or university. Regional accreditation is the gold standard for institutions -- particularly liberal arts and research schools.
In addition to institutional accreditation, an accounting program can hold specialized accreditation. Graduate accounting programs may hold accreditation from the Association to Advance Collegiate Schools of Business, which accredits business schools and creates accreditation standards for accounting.
Accreditation benefits accounting students in several ways. For example, graduate students who earn credits at an accredited institution can more easily transfer those credits to another institution. Additionally, only accredited schools meet the qualifications for federal financial aid, meaning students in an unaccredited program cannot qualify for federal loans or grants.
Furthermore, Ph.D. programs may only accept graduates with an accredited degree, and learners may need an accredited diploma to earn some professional certifications. Employers may also sort job applicants based on whether they hold an accredited degree. As such, prospective accounting students should carefully research accreditation status.
After earning a forensic accounting master's degree, graduates can enter the workforce, pursue specialized certifications, or apply to a Ph.D. program.
Enter the Workforce
Forensic accountants may work for financial institutions, government agencies, or law enforcement, searching out financial fraud. They also audit financial reports. With a master's in forensic accounting, graduates can pursue jobs in many industries and apply their graduate training in the workforce. Professional organizations can also help forensic accountants find job opportunities.
Earning a certification helps fraud examiners stand out on the job market. For example, accountants can become certified fraud examiners to demonstrate their advanced skills in fraud examination. In general, to earn certification, candidates must pass an examination and complete continuing education credits to maintain their credentials.
Pursue a Ph.D.
Forensic accountants with an accredited master's degree may meet the qualifications to enroll in a Ph.D. program in accounting. Ph.D. graduates often go on to fill academic and research positions, and they may work as tenure-track professors. During a Ph.D. program, forensic accountant students conduct original research and write a dissertation to become experts within their specialization.
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