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Tips for Legal Counsel Working with Forensic Accountants by Richard Pollack, CPA

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Posted on September 22, 2021 by Richard Pollack

Seasoned litigators consider forensic accountants their secret weapon when defending cases involving economic damages.  By relying on carefully honed skills to investigate, audit and uncover often-complicated financial transactions, forensic accountants can sort through mountains of data to connect seemingly unrelated dots and identify hidden assets or instances of fraud.

In addition to identifying financial facts, forensic accountants can also lend their expertise to other aspects of your legal defense.  For example, they can help you to request pertinent documents during the discovery phase; they can draft specific questions helping you to challenge opposing expert testimony during deposition; and they can serve as invaluable assets during settlement negotiations.

When working with forensic accountants, legal counsel need only consider three principals to ensure a successful partnership:

Start Early.  Retain a forensic professional as early as possible to help identify the accounting and financial considerations of your case, from the beginning. This will assist you in building or altering a defendable legal strategy going forward.  Moreover, by hiring a forensic accountant early on, you can maximize his/her credibility and contributions to your case while minimizing your long-term expenditures of time and money.

 Share Information.  Provide your forensic accountant with all relevant documents – the good and the bad – that will enable him/her to accurately analyze financial data, assess damages and identify vulnerabilities in your case.  Remember, when counsel hires forensic litigation support, the privilege between you and your client is extended to the work product of that between you, your client and the forensic accountant.

Share Expertise.   Make sure your forensic accountant understands how his/her opinions will fit into your case.  You should share with him/her the allegations in the complaint, including causation and mitigation, as well as appropriate case law that supports damages or valuations.  Legal counsel should become equally knowledgeable about the forensic accountant’s work and his/her assumptions in order to present them in a manner in which a judge or trier of fact will find them easy to understand. Keep in mind that your expert should be using “provable and reasonable assumptions” that comply with Frye and Daubert rules of evidence.  If not, the court may exclude your expert’s testimony and the data he/she presents.

A forensic accountant can supplement even the best attorney’s case by applying his/her knowledge to simplify the complex and provide fair, objective and independent expert testimony.  Working in tandem with an accountant early on and with full disclosure, a forensic accountant can provide a unique perspective that can prove to be the key element in bringing about a favorable legal outcome.

About the Author: Richard A. Pollack, CPA/ABV/CFF, ASA, CBA, CFE, CAMS, CIRA, CVA, CGMA is director-in-charge of the Forensic and Advisory Services practice with Berkowitz Pollack Brant, where he has served as a litigation consultant, expert witness, court-appointed expert, forensic accountant and forensic investigator on a number of high-profile cases. He can be reached at the CPA firm’s Miami office at (305) 379-7000 or via email at info@bpbcpa.com.