Financial Sherlock Holmes Role of the Professional Accountant: Empirical Analysis of Contemporary Forensic Accounting Knowledge, Skills and Values

Abstract

Abstract

Purpose:

In the aftermath of a storm of financial fraud, the repeated failures of conventional financial fraud investigations stimulate knowledge, skills, and a value shift in accounting. This study aims to develop a contemporary forensic skill knowledge and value model to implement forensic accounting for fraud mitigation.

Design/methodology/approach:

The research is profoundly entrenched in institutional theory and the institutional forces that necessitate modern skill sets. As a result, the study considered 13 forensic knowledge, skills, and values components of forensic accounting practitioners' perceptions of what components are essential for becoming a forensic accountant, including accountants and auditors, academics, forensic accountants, fraud investigators, and users of forensic services. The exploratory factor analysis is used to determine the structure of the variables and to comprehend the interconnection between them.

Findings:

The component analysis loaded three latent variables labelled social and behavioural skills, cognitive skills, and technical skills, which explained 67.314% of the variation. All three components demonstrated good reliability, with Cronbach's alpha better than 0.82. The confirmatory factor analysis results add to the outcomes of the exploratory study above by showing a good and consistent fit to a number of forensic accounting knowledge, skills, and values components.

Theoretical and Practical Implications:

The research on forensic accountants' knowledge, skills, and values within institutional theory provides theoretical insights by enhancing our comprehension of how institutional logic necessitates dynamic capacities. The academic and practical value of this work is found in its potential to provide multidisciplinary knowledge, shape educational practices, and assist policymakers in creating fraud management regulations that strike a balance between standardisation and professional adaptation.

Originality/value:

Since the existing literature is limited in scope, diverse, and fragmented, this study will provide a long-term, sustainable solution to combat financial fraud by promoting theoretical, practical, and policy reform compatible with the new accounting paradigm