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Drawing Conclusions From Accounting Evidence

As an independent forensic accountant assisting parties with financial disputes I am often obliged to provide opinions regarding the evidence that I have examined. This is an obligation not to be taken lightly, particularly when a person’s liberty or life savings might be at stake.

Opinions are a grey area, and may differ from person to person based even on the same knowledge of the underlying issue. For opinion evidence to be credible to the Court, it must be backed by facts along with the experience and qualifications of the expert.

Therefore it is important for an expert to be careful and precise when working, and above all remain impartial. This does not mean that an expert is not useful to one side or another, just that there may be cases where expert accounting advice will encourage a Defendant to plead guilty or a prosecutor to drop the case. Some expert witnesses have been accused of being “hired guns”, which is a sure way to ruin a career! Clients expect you to be “batting for their side”, but this is not always possible – independence is the key to a just outcome.

So an expert witness is most valuable when remaining totally independent. Nevertheless, there has been the odd occasion when I have crossed my fingers in the hope that a matter is decided in a particular way!

Most professional experts I encounter understand the need for impartiality, however in my work I see examples of dubious behaviour by many individuals involved in my field of financial crime. Apart from the Court (including the experts and to a lesser extent the lawyers) all other parties have a vested interest in the case. Witnesses have to present facts to the best of their knowledge, but may be friendly with (or conversely: absolutely hate) the Defendant. An officer has a duty to uphold the law, but may have been working on a single investigation for a couple of years and is determined to “win” the case.

When forensic accounting can assist a case

I recently assisted the Defendant in a case being brought against her for allegedly stealing £10,000 from her employers. A council investigator had analysed financial documents and correctly determined that the money was not where it ought to be. The investigator, not an expert, improperly gave the opinion in his report that the Defendant had stolen the money – effectively an opinion as to guilt (a task reserved for the jury).

It was important to challenge this report, which ignored very real possibilities that the money had been misplaced. My work showed evidence of money being deposited in the wrong bank account.

Even with the strong evidence casting doubt over the Defendant’s guilt, the employers seemed dogmatic in their attempts to win their case. When giving evidence, the Defendant’s line manager gave evidence that seemed to be wrong. Although no expert in body language, her demeanour gave me the impression that she was uncomfortable. To say she was lying would be presenting an opinion that I could not support, but that is the conclusion I was left with. It seems that the jury picked up on this also, and together with the judges qualifying remarks regarding my own evidence ensured happily that a not-guilty verdict was given.

Expert accounting evidence was definitely needed!

I had given my evidence in a totally impartial fashion and can never second-guess what a jury will decide. In this case I was heartened by the result. The message I took away was that the Court needs independence to get the right result, but in an adversarial system that is British criminal justice there are no guarantees that this will be achieved.