Page 15 - Expert Witness

wants to prove that the practices of the defendant company’s accountant contributed to nondisclosure or
fraudulent disclosure in the financial statements. A practitioner who is considering accepting the plain-
tiff’s engagement needs to consider if the practices of the defendant’s accountant represent conduct that
the practitioner or his firm engages in or condones in its own practice.

Typically, practitioners disclose current and former relationships with all the parties to the litigation to
the client’s attorney so that the attorney and his or her client have the ability to make their own determi-
nation about whether a conflict exists. During this process, the practitioner should be mindful not to dis-
close any information that could be confidential to his or her other clients without prior consent.

In some cases, the parties know of, and agree to waive the conflicts of interest; however, the practitioner
should exercise caution to avoid improperly disclosing any relationship or service to others that may
violate professional client confidentiality.

Engagement Acceptance

Prior to agreeing to serve as an expert witness or a consultant for a forensic accounting services en-
gagement, the practitioner should determine whether there are any conflicts of interest. If no conflict ex-
ists, or after any known conflicts are satisfactorily resolved, the practitioner may want to understand the
expected role of the practitioner and others in the matter, the scope of the assignment, any potential limi-
tations, the expert opinion(s) the practitioner is asked for, and any other pertinent matters. After obtain-
ing this understanding, the practitioner should carefully evaluate the ability to serve by determining his
or her qualifications, independence and objectivity, absence of bias, resources and availability, fee struc-
ture, and engagement terms.

Accountants, who perform expert witness or litigation consulting services, or both, need to consider and
comply with accounting and other professional standards and relevant legal guidance or requirements
specific to the situation, as discussed with legal counsel. As more and more cases are decided through
the court systems, the implications on litigation strategy and the role of the financial expert and consult-
ant play are critical factors in successfully representing your client while maintaining your independ-
ence, integrity, and objectivity.

Unlike attorneys who are engaged to represent their clients zealously, practitioners are engaged to be
advocates for their professional opinions and not to advocate for any of the parties involved in the dis-
pute. As stated previously, when acting as an expert witness, the practitioner needs to maintain his or her
independence and objectivity at all times during the engagement and not become the client’s advocate.
In this capacity, the practitioner’s role is to form an objective professional opinion based on facts or hy-
potheses. When serving as an expert witness, the practitioner needs to present and defend his or her po-
sition with strength and conviction.

The practitioner’s reputation and qualifications will likely become an issue in judicial proceedings be-
cause of the impact of two seminal cases. In Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S.
579, 113 S.Ct. 2786 (1993), the Supreme Court upheld the rule that expert opinion based on a scientific
technique is inadmissible unless the technique is "generally accepted" as reliable in the relevant scien-
tific community. Kumho Tire Co v. Carmichael, 526 U.S. 137, 119S.Ct. 1167, 1179 (1999) extends
Daubert not only to scientific testimony but to all expert testimony. As these and many other cases sug-
gest, the scheduling or calendaring order and relevance of the expected testimony will likely be subject-
ed to careful judicial scrutiny before expert testimony will be allowed to be presented at the trial. There-
fore, when deciding whether to accept a litigation services engagement, the practitioner should seriously

© 2020 Association of International Certified Professional Accountants 13