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RULES OF EVIDENCE – A FORENSIC ACCOUNTANTSPERSPECTIVE

October 10, 2019 TaylorHay

A more controversial explanation is ‘adversarial bias’, which refers to bias that derives in some way from the use of an expert by a party in litigation.AnianoLuzung describes several types of adversarial bias:

Deliberate partisanship: This type of adversarial bias occurs when an expert deliberately tailors evidence to support his or her client.

Unconscious partisanship: In this form of adversarial bias, the expert does not intentionally mislead the court, but is influenced by the situation to give evidence in a way that supports the client.

Selection bias: Selection bias refers to the phenomenon in which litigants choose as their expert witnesse persons whose views are known to support their case.

At the time of accepting an engagement, a forensic accountant does not know if the matter will proceed to court or if it will be a criminal or civil proceeding. From my perspective I don’t need to know at this point. Each case investigated should be conducted on the presumption that the scrutiny applied to a forensic accountant’s report will be no less than what can be expected in a civil or criminal proceeding. This is the standard by which a forensic accountant should conduct their investigation.

How can a forensic accountant achieve better outcomes by applying the rules of evidence during an investigation?

A forensic accountant’s principal task is to collect evidence and report findings of fact. Any evidence relied upon must prove or disprove a fact. If the evidence doesn't relate to a particular fact, it is considered "irrelevant" and is therefore inadmissible. Making unstated findings of fact and providing a self-interpretation of them is one example of when evidence cannot be admissible.

The rules of evidence area fundamental component within a system of justice that has many interconnecting parts of which forensic accounts need to navigate, usually with assistance from counsel. Although there can be practical difficulties in persuading a court to accept evidence the argumentation skill of the forensic account is also important. I use the words “argumentation skill” deliberately as forensic accountants must justify their conclusions with strong evidence-based arguments. In other words, evidence presented to a court is only as effective as the accuracy of the facts and assumptions upon which it is based.Simply collecting evidence is not good enough.

At the end of an investigation it is imperative that the investigators report clearly identifies, list and makes known the premises upon which their conclusion is expressed and is completely void of adversarial bias. Regardless of the investigator’s credentials, their report will be scrutinised not only by the court, but the opposing side will do their best to discredit the report and author. It is at this point where the benefits of using the rules of evidence as a tool throughout your investigation are realised.

Following the above principles will not guarantee evidence will be admitted but may negate some of the inadmissible risks.

Chris Taylor is a Certified Fraud Examiner and Forensic Accountant specialising in fraud detection and prevention within the hospitality industry. Follow Chris here on LinkedIn or visit www.taylorhay.com.au for more information.