The role of the accountant as an expert witness is to educate the trier of fact; i.e., to educate the court; to educate the judge; to educate the jury; to educate the attorneys. This relatively simplistic statement is the absolute crux of the situation. The accountant should keep this notion forever engraved on his or her psyche when serving as an expert witness.
An accountant might play other roles in providing litigation support services. The accountant might serve as a “fact” witness and they might serve as a consultant. As a fact witness, the court is interested in hearing what the accountant knows to be facts in a case and not the accountant’s opinion about the facts or opinion about other theories or issues in the case—as Detective Joe Friday used to say on the old Dragnet television series, “Just the facts, madam, just the facts!” Either side in a legal dispute might hire an accountant to consult on the handling of the case—to assist in the advocacy of the respective side’s position. In this consultant role there is an inherent bias. But as an expert witness, the witness is to be objective and independent with regard to educating the trier of fact about this area of specialized knowledge and the expert’s opinion about the same.
The expert witness is, of course, expected to base their testimony on sufficient facts or data; to use reliable principles and methods; and to apply the principles and methods appropriately. This is essentially the same as what is required of certified public accountants (CPAs) by Generally Accepted Auditing Standards (GAAS) when performing an audit of an entity’s financial statements. In addition, quite significantly, is the requirement of the accountant/expert witness to educate. One should never mistake a lack of knowledge for a lack of intellect. Assuming that the trier of fact is of reasonable intellect, the expert witness’s job is to provide and explain the knowledge. The persons to be educated are the judge, the jury if a jury trial and the attorneys involved.
Your attention is directed to the following Federal guidelines about the testimony and reports rendered by an expert witness, accountant or otherwise (emphasis added). Earlier the points were made that the expert witness is:
- Unique in their testimony as to opinion– may testify thereto in the form of an opinion
- To educate the court– assist the trier of fact to understand the evidence
- To educate in writing and orally– a written report prepared and signed by the witness
FEDERAL GUIDELINES ON EXPERT WITNESS ON TESTIMONY AND REPORTS
A. (FRE) Rule 702. Testimony by Experts: “If scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training, or education, may testify thereto in the form of an opinion or otherwise, if (1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3) the witness has applied the principles and methods reliably to the facts in the case.”
B. FRCP Rule 26(a)(2)(B). “(B) Except as otherwise stipulated or directed by the court, this disclosure shall, with respect to a witness who is retained or specially employed to provide expert testimony in the case of whose duties as an employee of the party regularly involve giving expert testimony, be accompanied by a written report prepared and signed by the witness. The report shall contain a complete statement of all opinions to be expressed and the basis and reasons therefore; the data or other information considered by the witness in forming the opinions; any exhibits to be used as a summary of or support for the opinions; the qualifications of the witness, including a list of all publications authored by the witness within the preceding ten years; the compensation to be paid for the study and testimony; and a listing of any other cases in which the witness has testified as an expert at trial or by deposition within the preceding four years.”
As an expert witness, you have been engaged by a member of the court. That might have been an attorney representing one side or the other. That might have been the judge. I believe that part of the educational process should include:
- Trying to teach all you know about the specific and narrow area(s) being addressed
- Distinguishing among that which is the definite, the plausible, the probable, and/or the possible
- Giving instruction about the accounting issues and/or flaws in opposing opinions or views
- Sharing anticipated opposition responses to arguments made
- Elaborate as to rebuttals thereto.
You should not assume any particular level of knowledge on behalf of the members of the court. They may or may not possess accounting, financial, or economic experience or training. Perhaps the attorney you are working with might be familiar with the relevant knowledge and experience of the members of the court. By your presence, you should assume a need to educate. One of the challenges is to be able to explain complex issues and concepts is a manner that is understandable to the uneducated or relatively uneducated. You must be able to teach. Allow me to repeat myself. This relatively simplistic statement is the absolute crux of the situation. The accountant should keep this notion forever engraved on his or her psyche when serving as an expert witness.