Forensic Accounting Market Size, Share, Growth Analysis, By Component(Solution/Platform [Forensic Tools/ Software, Audit/Accounting Software, And Others] And Services), By End-User(Banking And Insurance, Law Enforcement Agencies, Government, Accounting Firm), By Region - Industry Forecast 2024-2031

Drivers

Increasing demand for cloud-based forensic accounting solutions drives the market growth

• Forensic accounting practitioners have been implementing “cloud” based forensic accounting systems that enable them to expand or shrink computing abilities whenever necessary without complications. Therefore, this flexibility allows them to handle more data for investigation purposes and also perform complex analysis with minimal infra-structure expenses. Businesses no longer have to spend on costly equipment, software purchase and maintenance costs through cloud solutions. Instead of paying big sums for the initial capital costs, it is possible for them to subscribe and pay for the services that they need as they need them thus reducing their budget. This affordable price tag has made these Forensic accounting solutions more accessible to many organizations including SMEs.

• Such cloud-based solutions may seamlessly incorporate different accounting or finance systems like ERP, financial management software, and data analytics platforms. Data transfer is also automated and it minimizes errors because people do not have to manually enter data every time, leading to increased productivity.

• Forensic accounting should be integrated in strong conjunction with new technological developments like artificial intelligence and machine learning. In light of the rapidly transforming business environment, it is important to have forensic accounting solutions that can readily communicate with other software or equipment. Additionally, advancements in computer-aided accounting have been adopted for greater transparency. Secondly, enterprises can reduce the processing time by embracing optical character recognition (OCR), which industry has adapted for the same purpose of efficiency. For instance, a number of 600 plus corporate applications like Google Calendar and PayPal, are already interfacing with QuickBooks.

Restraints

High costs and lack of awareness hamper the market growth

• According to SkyQuest in-depth research, we found that there are cost implications in forensic accounting services, especially for the SMEs. Some potential clients may be deterred by the cost of employing experts for investigations, analyses and expert testimonials, which they consider costly. For example, as indicated in the 2020 ACFE compensation guide for anti-fraud professionals, the median CFE compensation is approximately USD 95,937. The fact that many business people and organizations were unaware of the potential and benefits of forensic accounting services, was also a factor. This lack of knowledge may slow down the market expansion as customers may not realize that they need these services until they are financially down. Hence, this will hinder the expansion of the forensic accounting services industry during the forecast period.