The forensic accountant’s role in bankruptcy and distressed situations
The devastating effects of the COVID-19 pandemic will endure for years. On an economic level, the coronavirus ravaged entire industries, with almost 22,000 companies filing for bankruptcy protection in 2020, and more distressed situations and bankruptcy filings expected in the years to come.
As the economy continues to crawl out of the rubble of the pandemic, forensic accountants will play a key role in ensuring that corporate stakeholders receive crucial information about their investments. Forensic accountants will be called upon to investigate fraud allegations, help with bankruptcy-related litigation and assess compliance with financing agreements, among other vital functions.
In a distressed situation, a forensic accountant must possess a thorough understanding of accounting and ﬁnancial concepts, have the ability to analyze complex situations, and be able to communicate any related issues and concerns to stakeholders.
Read an article from RSM’s John Tira and Maryellen Sebold to discover more about the important role that forensic accountants will play as the economy emerges from the pandemic. After all, just because the pandemic is easing doesn’t mean that companies will bounce back overnight. The need for reliable and experienced forensic accountants will only grow throughout 2021 and into 2022 as the fallout of the pandemic is carefully deliberated and fully examined.
This article is reprinted with permission from the California Society of CPAs, March 2021.