NEW YORK (July 22, 2014) – In an environment where the
exponential growth of information available is changing the way many
businesses operate, CPAs working in the forensic and valuation areas
have identified big data as the most pressing issue they’ll face in the
near future. In addition, 85 percent of respondents to the
2014 AICPA Survey on International Trends in Forensic and Valuation Services anticipate an increase in the amount of time they spend on electronic data analysis in the near future.
One in four (25 percent) respondents selected electronic data
analysis – better known as big data –
when asked, open-endedly, to name
their top five issues over the next two to five years. The frequency
with which big data was cited, reflects a business culture with an
increasingly sophisticated understanding of the potential of this
information. However, the sheer volume of data has created an
environment where fraud can become more difficult to detect.
“Big data presents a real opportunity for businesses to glean
actionable insights from information. However, the downside is that it
also presents a risk because the more data available, the harder it is
to spot fraudulent activity, such as the creation of a fictitious
employee or an improper payment to a vendor. To combat this risk,
businesses rely on forensic accountants for their expertise digging deep
into the data, unraveling the work of criminals and detecting that
fraud,” said Jolene Fraser, CPA/CFF and chair of the survey committee.
After electronic data analysis, the additional top issues forensic
and valuation professionals cited they anticipated facing over the next
two to five years are:
· increased complexity and scrutiny in engagements (20 percent)
· competition and fee pressure (14 percent)
· regulatory changes (11 percent)
· attracting and retaining qualified staff (7 percent).
The survey found that a majority (76 percent) of forensic respondents
expected to experience increased demand over the next two to five
years. Specifically, 30 percent expected demand for their services to
increase up to 25 percent, and an additional 33 percent expected growth
of up to 10 percent. On the higher end of the spectrum, nearly 13
percent of forensic accountants expect demand to spike by 50 percent or
higher. Twenty percent forecast no change in demand, and 4 percent
expected a decrease in demand.
Steady growth was expected in the valuation area as well, more than
half (54 percent) of respondents expecting more demand for their
services in the next two to five years. Specifically, 28 percent
anticipated demand to increase by up to 10 percent, with an additional
18 percent anticipating a bump in demand of up to 25 percent. More than
six percent expected demand to increase by 50 percent or higher.
Forty-one percent forecast no change in demand, and six percent foresaw a
decrease in demand for their services.
“The increasing demand we’re seeing for forensic and valuation
services performed by CPAs shows the growth in these areas is poised to
continue in the near future,” said
Jeannette Koger,
CPA, CGMA, vice president of member specialization and credentialing at
the AICPA. “Businesses and consumers realize that the CPA combined with
the AICPA’s Certified in Financial Forensics (CFF) and Accredited in
Business Valuation (ABV) credentials signifies a highly qualified
professional with the skill-set to get the job done.”
Indeed, when respondents were asked what credentials they require of
those providing forensic accounting services to possess, a CPA was the
most frequently required credential. The CPA, coupled with the
CFF credential,
provides the most desirable combination of credentials in the areas of:
fraud prevention, detection and response; financial statement
misrepresentation; damages calculations; bankruptcy; and electronic data
analysis. In addition, the CPA coupled with the
ABV credential was the most widely desired combination of credentials for valuation engagements.
The 2014 AICPA Survey on International Trends in Forensic and
Valuation Services was open to members of CPA Canada, in addition to
AICPA members, for the first time. The survey, which was conducted from
September 12 to October 25, 2013, contained a total of 182 qualified
responses.