On February 17, 2020, 61 students attended the second Student Accounting Association meeting of the spring semester. SAA president Sarah Crownover introduced guest speaker Kirsten Flanagan, a 1994 IUP accounting alumnus and a partner at Friedman LLP in their Philadelphia office, where she specializes in the areas of forensic, litigation, and valuation services. Flanagan has worked directly on several of the most notorious fraud cases of the past two decades, including Enron, Lehman Brothers, Tyco, AIG, WorldCom, Waste Management, and the Bernie Madoff Ponzi scheme.
Flanagan is a former student of Kim Anderson, professor in the Department of Accounting and the SAA faculty advisor. According to Anderson, “I had Kirsten in class back in 1992. I was thrilled when she agreed to travel to IUP all the way from Philadelphia to speak to both the SAA and to our forensic accounting course taught by Dr. Veronica Paz. Kirsten’s work experience on high-profile fraud cases is unbelievable. Hearing from an alumna really helps students to see themselves doing the same type of work someday.”
Flanagan has assisted the SEC, Department of Justice, and state Attorneys General offices on various matters, including a variety of litigation support services involving accounting and auditing issues, financial statements, SEC matters, the computation of damages, investigation of fraud allegations, marital disputes, assessment of internal controls, and financial analyses. She performs these services in connection with trustee proceedings and securities violations actions, as well as in connection with derivative claims, criminal proceedings, and other litigation.
The SAA hosted guest speaker Kirsten Flanagan, partner at Friedman LLP, at their February 17 meeting. Pictured: Ben McClosky, freshman accounting major; Flanagan; Kim Anderson, SAA faculty advisor; Megan Rengers, senior accounting major; and April Murdick, SAA senior vice president
Flanagan’s speech was a great opportunity for the students to learn more about a career in growing area of forensic accounting. She explained that a forensic accountant assesses financial information, determines fraud methods, and identifies internal control weaknesses.
To be a forensic accountant, a person must obtain an accounting degree, earn certifications such as the certified public accountant or certified fraud examiner, and have knowledge of securities litigation.
She covered several areas in the field of forensic accounting, including corporate evaluations and financial statement fraud, white collar crimes, asset misappropriation and embezzlement investigations, civil litigations, and business valuations from things like divorces or shareholder agreements. She also talked about her experiences working on several of the aforementioned high-profile fraud cases.
As a forensic accountant, Flanagan said that some cases take years to resolve. She helped with the Enron case, which took 10 years before it was settled. One of her favorite cases which took a number of years to resolve was the WorldCom case. She worked closely with the lawyers to help them understand the company’s financial statements and to help devise questions to determine what the investment bankers did wrong. The fraud committed by the investment bankers was capitalizing a cost that should have been an expense. This resulted in the bankers having to pay $6.1 billion, and the accounting firm also had to pay fines.
Another interesting case Flanagan was involved with was the Petrobras case, one of the largest corruption schemes in forensic accounting. Friedman was hired to investigate the oil refineries and corruption of Petrobras in Brazil.
The SAA’s next meeting is scheduled for Thursday, March 5, at 6:00 p.m. in the Eberly Auditorium. It is a joint meeting with the Student Finance Association, and all interested students are welcome to attend. PNC accounting and finance professionals, including two alumni, Brady Wise (accounting,’95) and Mitch O’Shell (MBA, ’19), will be presenting. The topics to be covered include personal branding, social media, networking, résumé building, and interviewing followed by an overview of the Independent Risk Management internship and development program of PNC.
—Sandra Shanshala, SAA Publicity Chair