FORENSIC ACCOUNTING INVESTIGATIONS

The need for forensic accounting may be prompted by one or more of the following actions:

• Internal or board investigation
• Regulatory investigation by the SEC, DOJ or other agencies
• Class-action shareholder securities litigation
• Litigation or arbitration pertaining to flow of funds and/or accounting issues
• Allegations of fraud or corrupt activities

Our senior forensic accountants hold the designation Certified in Financial Forensics (CFF) issued by the AICPA in recognition of their education, training and experience in the field of forensic accounting.

The BVA Group has experienced CPAs/CFFs who have led forensic accounting investigations for matters that include:

• Asset Misappropriation
• Securities Fraud and Ponzi Schemes
• Merger and Acquisition Accounting Disputes
• Marital Dissolution Matters
• Probate, Trust and Estate cases

Our procedure is to understand the needs of our clients and offer a team that has the experience and knowledge to conduct a financial investigation with the highest professional standards on a cost effective basis. Our typical approach would include data gathering and assessment, investigative interviews, detailed analyses, and presentation of our findings.

Asset Misappropriation

A forensic accounting investigation may be needed if any of the following activities are suspected:

• Skimming of receipts
• Manipulation of cash receipts or count records
• Accounts receivable lapping, check diversion and false credits
• Ghost employees, unauthorized pay rates, overtime, commission or bonus payments
• False vendor/invoice, inventory receipt and/or shipping documents
• Check tampering
• False expense reimbursements

Securities Fraud and Ponzi Schemes

BVA has the forensic accounting experience to analyze data and determine key fact patterns related to:

• Financial representations made to investors
• Timing, amount, and terms of invested funds
• Overall sources and uses of cash
• Expenditures and transfers for business purpose or other use 
• Use of newly invested funds
• Financial condition of the entity
• Operation of the business and historical profitability
• Ability to pay existing investors from funds generated from operations
• Sources of funds used to pay existing investors
• Reasonableness of the entity's forecasts and projections

Merger and Acquisition Accounting Disputes

When disputes about purchase price adjustments and alleged breaches of financial representations arise, BVA has the expertise to provide forensic accounting services related to:

• Net working capital
• Reserves for bad debts
• Unrecorded or disputed accounts payable
• Inventory valuation and obsolescence
• Contingent liabilities
• Work-in-progress production estimates
• Claimed assets not meeting Generally Accepted Accounting Principles ("GAAP") requirements
• Ambiguous or inconsistent language in agreements
• Failure to specify resolution of GAAP versus consistency

Marital Dissolution

Divorce proceedings can be very emotional and have a distinctly personal nature requiring additional sensitivity by financial experts. These disputes are often resolved based on the equitable distribution of assets rather than strict legal or economic interpretations. The BVA Group has an understanding of relevant procedures and nuances based on significant experience with this type of litigation.

Separate property may become commingled in various accounts or combined with community property for certain transactions. For these situations, BVA offers detailed analyses related to the tracing of separate and community property in accordance with the required methods of allocation. In addition, BVA has the core competency to provide valuations of closely-held businesses owned by the marital estate.

Probate, Trust and Estate

Probate, trust and estate litigation proceedings may involve a wide range of issues. Typically, there is a disconnect between trust or estate accounting and the financials that are based on GAAP or an income tax basis of accounting, which may create confusion and conflict. It is not uncommon for a significant portion, if not all, of the family wealth to be illiquid in closely-held business interests, which may further complicate the matter.

BVA provides forensic accounting services to trustees, executors and beneficiaries related to:

• Breach of fiduciary duties
• Removal of fiduciaries
• Will and trust interpretation
• Prudent investor rule cases
• Fraud investigations
• Misappropriation of trust assets
• Attorney and fiduciary fee disputes

In addition, BVA has the core competency to provide consulting services related to valuation disputes.