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9798-384PractAid-06title 8/9/06 5 56 PM Page 1 PRACTICE AID 06-4 Calculating Lost Profits 9798-384 AME RICAN INSTITUTE OF C E R T IFIED P UBLIC A C C O U N TA N T S Business Valuation and Forensic Litigation Services Section Richard A. Pollack Scott M. Bouchner Craig M. Enos Colin A. Johns John D. Moyl Copyright 2006 by American Institute of Certified Public Accountants Inc. New York NY 10036-8775 All rights reserved. For information about the pr.

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Forensic accounting services generally involve the application of specialized knowledge and investigative skills possessed by CPAs to collect, analyze, and evaluate evidential matter and to interpret and communicate findings in the courtroom, boardroom, or other legal or administrative venue.

Forensic accountants act as financial detectives, examining questionable financial data, investigating fraud, and aiding in civil and criminal investigations.

Forensic accounting is a type of accounting that investigates financial information for potential evidence of crimes. Forensic accountants use accounting, auditing, and investigative skills to understand whether a person or company has committed financial misconduct, such as embezzlement or fraud.

Often, one of the final steps in determining lost profits, if any, is the calculation of saved/avoided costs. Saved or avoided costs are those that, in order to achieve the calculated lost revenues, would have been incurred but for the intervening event/act.

The difference between a certified public accountant (CPA) and a forensic accountant is that a CPA will often specialize in areas such as taxation, solvency or financial reporting and be licensed to open a business. A forensic accountant combines accounting knowledge with investigative skills.

If a plaintiff's business continues to operate, albeit at a lesser level of profitability, it is during that time period that a claim for lost profits may be determined. If, subsequently, the plaintiff's business ceases to operate, the plaintiff may then claim a loss of business value.

The amount of lost profits is determined by estimating the profits that would have been earned during the loss period if the damaging act hadn't occurred. These estimated revenues are then adjusted by the costs that would have been necessary to generate that revenue.

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© Copyright 1997-2025
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Form Packages
Adoption
Bankruptcy
Contractors
Divorce
Home Sales
Employment
Identity Theft
Incorporation
Landlord Tenant
Living Trust
Name Change
Personal Planning
Small Business
Wills & Estates
Packages A-Z
Form Categories
Affidavits
Bankruptcy
Bill of Sale
Corporate - LLC
Divorce
Employment
Identity Theft
Internet Technology
Landlord Tenant
Living Wills
Name Change
Power of Attorney
Real Estate
Small Estates
Wills
All Forms
Forms A-Z
Form Library
Customer Service
Terms of Service
DMCA Policy
About Us
Blog
Affiliates
Contact Us
Privacy Notice
Delete My Account
Site Map
Industries
Forms in Spanish
Localized Forms
State-specific Forms
Forms Kit
Legal Guides
Real Estate Handbook
All Guides
Prepared for You
Notarize
Incorporation services
Our Customers
For Consumers
For Small Business
For Attorneys
Our Sites
US Legal Forms
USLegal
FormsPass
pdfFiller
signNow
airSlate workflows
DocHub
Instapage
Social Media
Call us now toll free:
1-877-389-0141
As seen in:
  • USA Today logo picture
  • CBC News logo picture
  • LA Times logo picture
  • The Washington Post logo picture
  • AP logo picture
  • Forbes logo picture
© Copyright 1997-2025
airSlate Legal Forms, Inc.
3720 Flowood Dr, Flowood, Mississippi 39232