Which of the following best describes the term forensic accounting?
A. It is a discipline that deals with the preparation and analysis of financial statements of companies.
B. It is the use of accounting principles to consolidate financial statements of foreign corporations.
C. It is a discipline that primarily deals with methods of preparation of financial budgets of a company.
D. It is the use of accounting theories, principles, or analyses in a legal action, often through expert witness testimony.
Answer:D
Which of the following best describes the term forensic accounting?
A. It is a discipline that deals with the preparation and analysis of financial statements of companies. B. It is the use of accounting principles to consolidate financial statements of foreign corporations. C. It is a discipline that primarily deals with methods of preparation of financial budgets of a company. D. It is the use of accounting theories, principles, or analyses in a legal action, often through expert witness testimony.
Explanation: D) Forensic accounting can be defined as the use of accounting theories, principles, or analyses in a legal action, often through expert witness testimony. In other words, it is the application of financial facts to legal situations.