Now that busy season has come and gone (that is, for most of you) you may be thinking about what you're going to spend you summer doing. Of course you should relax and use some of your accrued vacay that's been thrown at you but you also me wondering what the next step in your career might be. For those of that haven't yet gotten your CPA, we recommend getting on that ASAP, especially if you're working in the public domain.
For the rest of you, some options include obtaining another certification that may assist you for your current role or prepare you for a position that you may have interest in for the future. We'll examine many certifications over the next several weeks to give you an idea of what the requirements are, what the benefits of the certification might be (yes, including salary) and some career options.
Since forensic accounting is somewhat fresh in our minds, we'll kick off this series with the CFE designation. It is administered by the Association of Certified Fraud Examiners ("ACFE"), the "world's largest anti-fraud organization and premier provider of anti-fraud training and education," according to the ACFE website. The website states that Association more than 50,000 members and it requires 20 hours of CPE every 12 months.
Steps to Obtaining a CFE
1) Be an Associate member of the ACFE in good standing - You can apply for membership here.
2) Submit the CFE Exam application with proof of education and professional recommendations - The ACFE requires three professional recommendations (form here). See the education and professional requirements below.
3) Pass the CFE Exam - After your application and supporting documentation is processed, then you must pass the exam (application here). It consists of five hundred objective and True/False questions administered via a computerized exam that has a $150 fee. The exam covers four areas: Fraud Prevention and Deterrence; Financial Transactions; Fraud Investigation; Legal Elements of Fraud. The CFE has a ton of resources to help with the exam including a prep course that has a money back guarantee.
4) Gain final approval from the certification committee and become a CFE - Assuming you're not living a double life, this should be the easy part.
The CFE requires a Bachelors Degree (or equivalent) and you may substitute two years of fraud-related work experience for one year of academic study.
Two years of work experience in one of the following fields will meet the professional requirements:
1) Accounting and Auditing - Anyone with experience " or the detection and deterrence of fraud by evaluating accounting systems for weaknesses, designing internal controls, determining the degree of organizational fraud risk, interpreting financial data for unusual trends, and following up on fraud indicators."
2) Criminology and Sociology - Do you know the criminal mind?
3) Fraud Investigation -If you've investigated fraud as a part of law enforcement or in the private sector (including insurance or internal investigations for other types of businesses).
4) Loss Prevention - This includes security consultants and directors but not your time working security as a mall cop.
5) Law - Candidates that have worked in a legal capacity including lawyers, fraud litigators and anyone working in an anti-fraud capacity.
The two largest groups in the ACFE's most recent compensation guide were fraud examiners and internal auditors. All of the Big 4 have forensic groups, internal auditors are increasingly become a more important part of the corporate structure and of course, the Federal government (including the SEC) is looking for fraud experts.
The other option, of course, is develop services that aren't already offered by your firm. Scott Heintzelman, Partner at McKonly & Asbury (aka The Exuberant Accountant) and a CFE told us that it was a way for him to get involved in a new new practice area, "Our firm was getting involved in more cases and I wanted to be a part of this exciting niche. I also saw it as a way to add value to all my clients, by using the best practices on the prevention side."
Compensation and Other Benefits
The most recent compensation information for "anti-fraud" professionals that we found was produced by the ACFE and it surveyed over 3,000 anti-fraud professionals. Of those, 64% had obtained their CFE and 36% had not. The median salary of those with the CFE certification was $90,300; those that did not have a CFE certification was $74,111.
And depending on the job function, the certification may have an effect on compensation. For example, the median salary for someone with "controller" as their primary job function was $104,500 while a non-CFE's median salary was $106,000. On the other hand, a respondent whose primary job function was "Internal Auditor" that had a CFE certification had a median salary of $92,000 while a non-CFE "Internal Auditor" had a median salary of $77,800.
Some non-monetary benefits that Scott shared with us is that it definitely raised his profile among the partners at his firm, "As a younger accountant in our firm, my partners clearly saw it as me making myself more valuable to them and my clients. I was the first in my firm and this was a clear distinction."
Ultimately, work experience and subsequent training will do the most good for those interested in fraud prevention as mentioned by both Sam Antar and Tracy Coenen in our recent post on forensic accounting. The appropriate mindset that includes "investigative intuition," "[thinking] like a scumbag," and "double iron clad balls." Sam insists that these personality traits and characteristics are the most crucial to any successful forensic accountant but he didn't dismiss the certification altogether saying, "[The] CFE designation is like chicken soup. It can’t hurt."
So for anyone that thinks that they have the personality and fortitude to make a run in forensics, the CFE can serve as tool to demonstrate your interest. God knows there's plenty of work out there.