LETTER FROM THE PRESIDENT
James D. Ratley, CFE
ACFE President and CEO
Huge fraud cases such as Enron and WorldCom were disastrous for their employees and communities. But they did wake up the lawmakers who had to face the huge personal and financial costs of fraud. One result was the U.S. Sarbanes-Oxley Act (SOX) of 2002, which made corporation CEOs and CFOs finally sit up straight and take responsibility for their quarterly statements.
SOX also opened up doors for CFEs. Public businesses — and nonprofits — now hire more CFEs who can help prevent and deter fraud (few entities, except the ACFE, used those words before SOX) and keep them out of deep trouble.
Also, SOX and the Securities and Exchange Commission (SEC), require that every public company's board of directors have a "financial expert" on its audit committee. This is a little-known opportunity for CFEs.
The author of our cover article, W. Steve Albrecht, Ph.D., CFE, CPA, CIA, writes that in 2013, more than 10 boards of directors asked him to join them, and during the past 12 years, he's been on eight boards for public and private companies.
Now, granted, Albrecht was the first ACFE president, helped develop the concepts in the Fraud Triangle, and is a legendary fraud researcher and professor. But hard-working and savvy CFEs of all stripes can place this on their goal lists.
The SEC says each financial expert candidate must have experience as a principal financial officer, principal accounting officer, controller or public accountant, or have supervised anybody in these positions. Albrecht writes that he didn't meet any of these work requirements. "However, as a CFE, I've served as an expert witness in 36 fraud cases in which I obtained experience overseeing and assessing the performance of companies and public accountants in the preparation, auditing or evaluation of financial statements," he says. "Were it not for my expert witnessing and other CFE fraud examination experiences, I wouldn't be qualified to be a financial expert."
As a fraud examiner you also might not have held any of these accounting-related positions, but if you've been in the industry for a while, there's a good possibility that you've done some expert-witnessing work.
Albrecht writes that most CFEs have the skills necessary to work on audit committees. "As a CFE, you might think you have a narrow background," Albrecht writes. "But you've developed skills that make you a great board and audit committee member and help you interact well in any business setting."
Maybe it's time for you to check out this rewarding career diversion.