FORENSICS AND INVESTIGATIVE ACCOUNTING QUESTIONS WITH CORRECT ANSWERS

Forensic Accounting Defined*** CORRECT ANSWER The science that deals with the relation and application of accounting facts to legal problems Objective of lost profit calculation CORRECT ANSWER Financially compensate the plaintiff for what the business would have done in absence of the harmful act. "Make whole" Lost Profits in Simplest Form CORRECT ANSWER Decrease in Revenue Change in Expenses Fraud Triangle CORRECT ANSWER Opportunity, Motivation, Rationalization Damage calculations that required additional knowledge and skills CORRECT ANSWER Wrongful Death Wrongful discharge Complete or partial disabilities Divorces (Similar Situations that take into account economic value of a person) Necessary to prove to win an economic damages case: CORRECT ANSWER Liability of defendant (wrongful event occurred) Plaintiff incurred financial damages (as result of wrongful event) General theory of economic damages CORRECT ANSWER The wrongful act has caused the plaintiff to be in a different position than he/she otherwise would be - Compensable damages restore injured party to his/her previous position - Damages depend upon what law will allow