Pacific Accounting Review

What is the ‘good’ forensic accountant? A virtue ethics perspective

Bryan Howieson,
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Accounting Review, Vol. 30 Issue: 2, pp.155-167, https://doi.org/10.1108/PAR-01-2017-0005
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What is the ‘good’ forensic Virtue ethics

perspective
accountant? A virtue
ethics perspective
Bryan Howieson 155
Business School, University of Adelaide, Adelaide, Australia

Abstract
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Purpose – The aim of this paper is to explore how virtue ethics might inform our understanding about what
constitutes “good” practice in forensic accounting. In particular, the paper explores the concept of phronesis
(or practical wisdom) as a basis for guiding the application of professional judgement in forensic accounting
practice.
Design/methodology/approach – The paper draws on a review of relevant literature.
Findings – Prior literature has identified a number of technical and personal characteristics and attributes
that are desirable in forensic accounting practitioners. Although being ethical is identified as an important
characteristic, the question of what constitutes a “good” forensic accountant has not hitherto been
investigated. Because of the profession’s multi-disciplinary and highly technical nature, forensic accountants
are significantly at risk of conflating ethics with compliance with the law. The paper suggests that an
understanding of virtue ethics and especially the virtue of “phronesis” or practical wisdom will help forensic
accountants maintain public confidence and quality in their services and provide practical guidance on the
exercise of professional judgement.
Practical implications – The paper suggests that the primacy currently given in forensic accounting
literature and practice to a commercial logic, technical competencies and legal compliance risks damaging the
professional standing of forensic accountants and, over time, reduces the ability of forensic accountants to
exercise professional judgement in complex unstructured situations. Virtue ethics can act as a useful counter
point to these threats.
Social implications – A recognition of the need for the forensic accounting profession to collectively
develop phronesis would re-establish the primacy of the profession’s public interest logic and maintain public
trust and quality in forensic accounting services.
Originality/value – There appears to be no prior literature in forensic accounting which explores the
application of virtue ethics in this field. In addition, although virtue ethics has been the subject of some prior
papers in accounting per se, the importance of phronesis as a basis for understanding the nature and
application of professional judgement has not been addressed.
Keywords Virtue ethics, Forensic accounting, Phronesis, Professional judgement
Paper type Viewpoint

Introduction
What is the “good” forensic accountant? This short but complex question could be debated
from various perspectives such as technical competence, knowledge or ethical behaviour.
These perspectives are not, of course, independent – the ethical forensic accountant will,
among other things, be technically competent. Often, however, the forensic accounting
literature tends to treat the answer to this question in a piecemeal fashion. Surveys of the
Pacific Accounting Review
Vol. 30 No. 2, 2018
pp. 155-167
The author wishes to thank Michael Jones and two anonymous referees for their insightful comments © Emerald Publishing Limited
0114-0582
and feedback. DOI 10.1108/PAR-01-2017-0005
 PAR desired attributes of forensic accountants usually concentrate on the necessary technical
30,2 knowledge and application skills with scant attention to the ethical dimensions of what it
means to be a professional forensic accountant (DiGabriele, 2008, Davis et al., 2010, Van
Akkeren et al., 2013). For instance, in their survey of CPAs, attorneys and academics for the
American Institute of Certified Public Accountants (AICPA), Davis et al. (2010) identify that
the second or third highest ranked essential trait or characteristic of forensic accountants is
156 that they should be ethical but, in the survey’s list of core forensic accounting skills, ethics is
notable by its absence. As noted below, many papers in forensic accounting also seem to
conflate ethics with the law and codes of conduct. Such a body of literature risks conveying
the image that ethics is in some way downgraded or simply assumed in forensic accounting.
Rather, a conscious and continuous integration of ethics into all aspects of professional life is
essential for promoting excellence in forensic accounting practice.
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This paper seeks to demonstrate how ethics can be integrated into forensic accounting
practice by exploring what it means to be a “good”[1] forensic accountant through the lens of
Aristotle’s virtue ethics (Aristotle, 1953). It will be argued that an understanding of what
constitutes the virtuous forensic accountant provides useful and practical guidance to
forensic accounting practitioners in the delivery of their services and it offers insights for the
education of both neophyte and experienced practitioners. In particular, the paper discusses
the importance of the need for forensic accountants to develop the key virtue of phronesis
(phronēsis), or “practical wisdom”[2], if they wish to achieve excellence in their profession. It
is acknowledged that much of the commentary that follows could apply equally to other
accounting sub-disciplines but the focus here reflects the forensic accounting context of this
special issue of the journal. There have been prior discussions of virtue ethics in the
accounting literature before (Doucet and Doucet, 2004, Howieson, 2005, Mintz, 2006,
Howieson, 2013, West, 2016) but I am not aware of any applications to forensic accounting.
More importantly, the application of the concept of phronesis has not been adequately
explored in the prior accounting literature (see, for instance, Lehman (2014) where the
application of phronesis is primarily limited to its implications for the accounting academy,
rather than forensic accounting practice).
In this paper, phronesis is viewed as the equivalent to the forensic accountant’s exercise
of professional judgement. Although it is an ancient concept, a reinstatement of the central
role of phronesis in the practice of forensic accounting (and other) professionals is more
timely than ever. Kinsella and Pitman (2012a), Sellman (2012) and Lail et al. (2015), for
example, have all argued that the practice and education of members of the professions have
increasingly suffered from a growing tendency towards a culture of instrumentalism and an
overemphasis on the application of rules and the development of technical “competencies”
(so-called skills-based learning). Instrumentalism is driven by the increasing dominance of a
commercial logic that permeates professional accounting practices (Greenwood and
Suddaby, 2006, Lander et al., 2013) and has come at the expense of one of the defining
characteristics of professionals, namely the exercise of professional judgement or, in other
words, phronesis. Lail et al. (2015, p. 8) suggest that the common regulatory response to
external shocks such as high profile corporate scandals is yet more “narrow, compliance-
focused legalism” which “perpetuate[s] the illusion of control [. . .] without necessarily
inducing real change” in the moral character of professionals. An increasing commercialism
of the professions (Lail et al., 2015), including accounting, and demands that universities
produce technically “competent” graduates (Sellman, 2012) threaten the profession’s and
community’s means of producing people who can effectively exercise professional
judgement. As Sellman (2012, p. 128) warns:
 Thus, we have a modern paradox. Current technicist-driven institutions expect competent Virtue ethics
practitioners but are unwilling to provide the environments in which competent practice can
thrive. This failure to invest in suitable practice and educational environments represents a
perspective
myopic perspective blind to the detrimental long-term effects of short-term efficiency gains; but
just so long as the political imperatives continue to drive the cost-cutting consequences of policy
dictates, so the pool of professionals aspiring toward phronesis [(professional judgement)] will
diminish. If the triumph of technical rationality becomes complete, then the danger to which
Schön (1983) was alerting us will leave us with few competent practitioners, and, as a result, we 157
will all be impoverished.
The remainder of this paper proceeds by first exploring why forensic accounting is
particularly exposed to the risk of adopting legalist and instrumentalist perspectives as a
basis for practitioner behaviour and education. Virtue ethics, and in particular, the virtue of
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phronesis is then briefly described followed by a discussion of how phronesis is relevant to

forensic accountants. The questions of whether phronesis can be taught and how it might
impact on the conduct of forensic accounting research are then explored. Finally, some
concluding observations are offered.

Law, ethics and forensic accounting

As a professional, the forensic accountant is expected to act ethically and in the public
interest. Van Akkeren et al. (2016) have recognised the ethical complexities that challenge
forensic accountants because of the multi-disciplinary nature of their services. For example,
out of all the sub-disciplines of accounting, the practice of forensic accounting is the most
intertwined with law (Van Akkeren et al., 2016). Not only must forensic accountants have
knowledge of relevant laws but they work closely with legal practitioners, gather evidence
and act as expert witnesses in legal proceedings. Several studies investigating the required
skills of forensic accountants have repeatedly stressed the importance to forensic
accountants of having considerable knowledge of relevant laws and competence in legal
processes such as the gathering and presentation of evidence (DiGabriele, 2008, Davis et al.,
2010). Others have identified the legal and regulatory environment as essential components
of forensic accounting education programs (Curtis, 2008). The interweaving of so much of
forensic accounting practice with the law, combined with the growth in the influence of
commercial instrumentalism and the demand for technical competencies, creates the real
risk that the behaviour of forensic accountants becomes dominated by a focus upon
compliance with legal and technical rules. That this outcome may already be the case can be
evidenced by the forensic accounting literature. As an illustration, in his description of a
model curriculum for a course in forensic accounting, Curtis (2008) devotes approximately
eight of the paper’s nine pages to training in legal rules and process. Approximately half a
page is spent on ethics and even that discussion is primarily rules-based, as it recommends
that forensic accountants should be educated to avoid “a violation of the corporate code of
conduct or a crime” (Curtis, 2008, p. 543). Of course, too much should not be made of one
example but a reading of the various studies and surveys into the recommended attributes
of forensic accountants reveals a heavy weighting given to the perceived importance of rules
in governing the behaviour of forensic accountants (DiGabriele, 2008, Davis et al., 2010, Van
Akkeren et al., 2013)[3].
Despite the importance of rules (the law, technical standards) and codes of conduct as
useful statements of community and professional expectations, they cannot be the sole
arbiter of what constitutes a “good” forensic accountant. There are a number of reasons for
this including the following:
 PAR  Rules are a feature of all communities, including corrupt ones. As Russell (1963)
30,2 noted, even bands of marauding pirates have a code of conduct about how a “good”
pirate should behave.
 Rules-based thinking can be dogmatic and consequently too inflexible to deal with
the uncertainty and ambiguity faced in the context of many professional services.
 Although rules appear objective because they are derived from some authority
158 external to the individual, they still need to be interpreted and this requires the
exercise of judgement.
 If in a given situation a rule is not available or its interpretation is ambiguous, a
rules-based thinker can be locked in a form of moral paralysis. A similar situation
arises when two or more rules have conflicting requirements (Doucet and Doucet,
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2004).
 As the newspapers regularly remind us, the existence of rules does not guarantee
compliance with them[4].

The limitations of rules-based ethics aside, some commentators have suggested that there
are more fundamental problems that challenge professional ethics. Lail et al. (2015) argue
that the damage to public trust in the professions (O’Neill, 2002) is the result of a change in
the professional motives and a loss of professional identity away from a public service logic
to a commercial logic[5]. Jennings (1991) has argued that the ethical challenges facing
professionals are not really about whether the professionals know what is actually right or
wrong but rather getting them to embrace a disposition to act:
(T)he problem is more one of how to create the commitment to the right thing within the psyches
and self-identities of moral agents [. . .]. Professional ethics has to address the challenge of
teaching professionals how to see the right, and it also has to figure out how to motivate the right
conduct [. . .]. Talking about taking bribes is really not an interesting ethical question because
there is no interesting argument in favor of taking bribes. There must be more to professional
ethics than that.
How then are forensic accountants to develop the appropriate sorts of ethical dispositions
that would promote public trust and excellence in their services? It is suggested here that
virtue ethics offers an answer to this question.

Virtue ethics
Virtue ethics is traced to Aristotle (1953) and has in relatively recent times been rediscovered
with modern proponents and interpreters including Foot (1978) and MacIntyre (2007).
Aristotle viewed ethics as being about the development of character-traits and dispositions
(“virtues”) that allowed human beings to achieve eudaimonia – that is, virtues are those
characteristics that allow humans to flourish or achieve excellence (Oakley and Cocking,
2001)[6]. The focus in virtue ethics is upon the character of the moral agent rather than, for
example, compliance with some external rule. Rather than asking the question, “What
should I do?” virtue ethics argues that the moral agent should ask, “What kind of person
should I be?” The answer is that the moral agent should be of good and virtuous character
who acts in a way that is consistent with that character. In other words, a good person is one
who acts consistently with virtues that promote human flourishing or excellence. More
importantly, the moral agent acts in this way because it is the “right” way to act. The
virtuous person is motivated to achieve excellence because eudamonia is intrinsically
 valued as the ultimate goal of the “good life”. As virtue ethics is focused on the actions of Virtue ethics
moral agents, it is context specific: perspective
The competent practitioner aspires toward the Aristotelean ideal of doing the right thing to the
right person at the right time in the right way and for the right reason (Sellman, 2012, p. 127).
For Aristotle, people are not born virtuous but rather they become virtuous through habitual
practice and repetition. It is only by practising the virtues that they become integral to a
person’s character which in turn will lead to more virtuous behaviour (Cassidy, 2006). 159
Aristotle (1953, I.13) identified two categories of virtues, intellectual virtues (including
theoretical wisdom, technical knowledge and practical wisdom) and moral virtues (including
generosity, courage, truthfulness and self-control)[7]. The virtuous person is one who can act
in a given situation in a way that best applies both the intellectual and moral virtues.
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Although it is one of Aristotle’s intellectual virtues, phronesis is “a special virtue” (Sellman,

2012, p. 115) because it guides the virtuous person in how to best combine the intellectual
and moral virtues in each specific situation. Phronesis is “excellence in deliberation” (Prior,
1991, p. 179) and as described by Kinsella and Pitman (2012a, p. 2) it:
[. . .] is an intellectual virtue that implies ethics. It involves deliberation that is based on values,
concerned with practical judgement, and informed by reflection. It is pragmatic, variable, context-
dependent, and orientated toward action.

The virtues of forensic accounting

With its focus on the context-specific acts of moral agents, virtue ethics has much to offer
forensic accountants. DiGabriele (2008) has noted that the practice of forensic accounting
differs from many other sub-disciplines in accounting because the diversity of services and
situations encountered by forensic accountants (Van Akkeren et al., 2013) more often
requires a flexible, improvised approach to decision-making and problem-solving rather
than some type of structured plan. The focus in virtue ethics on identifying virtues
(characteristics or attributes) that promote excellence is also directly relevant and
meaningful to all professionals.
Prior literature in forensic accounting has explored the nature of forensic accountants’
intellectual and moral virtues, although the discussion of these virtues has usually been
couched in language such as “work-based skills” and “personal attributes” (Van Akkeren
et al., 2013). Studies which have sought to identify the intellectual and moral virtues of
forensic accountants include DiGabriele (2008), Davis et al. (2010), Van Akkeren et al. (2013)
and Van Akkeren et al. (2016). In their survey of forensic accounting in Australia, Van
Akkeren et al. (2013) found the top five most essential work-based skills to be
communication, critical thinking, interpersonal skills, technical accounting skills and
attention to detail. The top five most desired personal attributes of forensic accountants
were interpersonal, analytical, inquisitive, intelligent/intuitive and engaging/confident. In
the USA, the survey conducted by Davis et al. (2010) found that the top five “core skills”
ranked by forensic accounting CPAs were critical/strategic thinking, effective written
communication, effective oral communication, investigative abilities and investigative
intuitiveness. The same survey found the top five desired “essential traits and
characteristics” of forensic accountants as ranked by CPAs to be analytical, inquisitive,
detail-oriented and ethical (both equally ranked), scepticism and intuitive. An additional set
of “enhanced skills” was also identified with a strong emphasis on technical knowledge and
capabilities including analysing and interpreting financial statements, interviewing skills,
fraud detection, testifying and general knowledge of rules of evidence and civil procedure.
 PAR Not surprisingly, findings such as these provide some evidence that the perceived
30,2 categories of work-based attributes and personal attributes of forensic accountants bear a
correspondence to Aristotle’s characterisation of the virtues as intellectual and moral.
However, these listings of forensic accounting virtues are usually presented from an
instrumentalist perspective in which they are viewed as necessary means for allowing
forensic accountants to provide their services. This is because the place of phronesis in
160 forensic accounting is left unclear and at best implicit. For example, it is possible that the
skill of “critical thinking” that is identified in these surveys may be akin to phronesis but it
is not possible to tell as these skills are left largely undefined and unexplained. In the Davis
et al. (2010) study, it is tempting to perceive the core forensic accounting skill of
“investigative intuitiveness” as being equivalent to phronesis but the term is never
explained in that paper.
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If the forensic accounting profession is to build and maintain public trust in its services,
if it is to improve the education of its members, and if it is to promote excellence in its
practices, then it will need to move beyond the rather fuzzy discussion of its intellectual and
moral virtues that is currently found in the relevant literature. In particular, a more explicit
recognition and explanation of phronesis (practical wisdom) would be helpful in promoting
the flourishing of the profession because it will increase forensic accountants’ awareness of
the need to combine both the intellectual and moral virtues of forensic accounting rather
than, for example, overemphasise, through the demands of commercialism, the technical
(intellectual) virtues at the expense of the public interest[8]. As noted earlier, phronesis, as a
form of professional judgement, sets professions apart from other occupations. The exercise
of professional judgement could be improved if forensic accountants engaged in an explicit
conversation about what professional judgement is and how it is developed and applied.
This would be helpful too to educators who could develop pedagogical approaches that
might better prepare neophyte forensic accountants for professional practice (both in terms
of what pedagogical techniques might be adopted and in acknowledging the limits of the
classroom setting as a context for effectively teaching professional judgement (phronesis)).

Phronesis and forensic accounting

Van Akkeren et al. (2016) have noted that forensic accountants typically face complex work
environments. They must work with other types of professionals, investigate and analyse
incomplete data and thus deal with uncertainty using improvised approaches to problem-
solving (DiGabriele, 2008). Resolving complex scenarios requires more than slavish
adherence to technical conventions. Forensic accounting professionals respond by
developing their professional judgement through an on-going process of self-reflection and
self-awareness (Schön, 1983). Schön (1983) recognised that professionals identify and apply
solutions to complex, unstructured problems not only by using relevant technical
knowledge but also they draw upon what they have learned from experiencing similar
situations in the past. The recognition that professionals develop their professional
judgement by conscious reflection on their prior experiences sits well with Aristotle’s claim
that phronesis or practical wisdom is acquired through habitual training and reflection on
prior acts (Aristotle, 1953, II.1):
The craftsman has to learn how to make things, but he learns in the process of making them. So
men become builders by building, harp players by playing the harp. By a similar process we
become just by performing just actions, temperate by performing temperate actions, brave by
performing brave actions.
 Sellman (2012) identifies an interesting, and I would suggest often overlooked, implication of Virtue ethics
a consideration of the role of phronesis in professional practice. The various surveys of perspective
forensic accountants’ skills and attributes concentrate on what types of (technical)
knowledge the forensic accountant needs to possess. However, Sellman (2012) notes that a
professional who has acquired phronesis and who is consequently continuously reflective
and self-aware will also recognise what it is that she doesn’t know. That is, she will be aware
of her own limitations and be committed to finding ways to overcome her ignorance and
reduce the limitations in her skill set. The forensic accountant who has nurtured phronesis 161
will thus avoid complacency and be constantly on a path to self-improvement and excellence
in forensic accounting practices.
Kemmis (2012) extends these ideas to explore the importance of phronesis in contexts of
uncertainty (as regularly faced by forensic accountants[9]). He notes that professionals bring
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to each new uncertain problem what they have learned from the outcomes of prior problems.
In the face of each new problem with its attendant uncertainties, the situation is unique and
so cannot be easily resolved by some sort of standardised solution or method. The forensic
accountant must deliberate as to what the nature of the problem is and, based on what
worked or didn’t work in the past, derive a set of actions in response. Kemmis (2012, p. 155)
observes that:
(T)he wise are aware and acknowledge that they must act in uncertainty. What distinguishes
these wise people from others is that, more often than not, they avoid both haste and indecision,
both excitability and detachment, and they act as best they can for the good (not just in ways that
are convenient or self-serving). What also distinguishes the action of the wise is that they act in
ways that avoid some of the traps and pitfalls that less experienced people do not see—especially
if the less experienced are misled by appearances so that a situation appears to be of one sort, but
turns out to have other faces that may be more important or involve trickier judgements about
what action is best to take.
Learning from experience requires the forensic accountant to actively reflect on those
experiences, to be open to new experiences and to have a willingness to accept that each
situation will be different. Kemmis (2012) acknowledges that the development of phronesis
will not, of course, remove uncertainty or equip the forensic accountant with all the
necessary attributes to confront future challenges but it will create a readiness in the
forensic accountant to take action in situations of uncertainty and to exploit what has been
learnt from experience. Developing and promoting greater awareness of phronesis has
important implications for the teaching, research and practice of forensic accounting and
these implications are explored below.

Can phronesis be taught?

The discussion above indicated that phronesis develops through a habitual process of self-
reflection and self-awareness associated with a forensic accountant’s experiences in practice.
Aristotle held to the belief that virtues are acquired through training by performing virtuous
acts that would be performed by virtuous people. As Prior (1991, p. 157) observes, “if I wish
to become virtuous, I must find a virtuous person and imitate his actions”. Kemmis (2012) is
of the view that phronesis is something that can only be acquired by experience. He states
that it can’t be taught or understood through “book knowledge” but he is prepared to
concede that it can be learned indirectly by providing opportunities for professionals to
learn from each other. All of this suggests that mentors and role models are an important
means by which phronesis can be inculcated into forensic accountants. All current members
of the forensic accounting profession thus have a responsibility to actively and
systematically mentor their colleagues.
 PAR Among accounting academics, Melé (2005) and Mintz (2006) for example have argued
30,2 that ethical education in accounting should incorporate pedagogical activities such as case
studies and reflective journals that would expose students to phronesis. Howieson (2005), in
an auditing context, has argued that some degree of phronesis can be developed in students
and professionals by training them in the practical skills of individual, organisational and
professional values clarification, decision-making and organisational policy setting. Such
162 efforts should be encouraged, as they may be helpful in sensitising students to the fact that
forensic accounting practice is not simply the application of technical rules and algorithmic
processes. However, the abstract nature of the classroom setting must be acknowledged as
always acting as a notable limitation on the ability of universities to expose students to the
lessons of practical experience (Howieson et al., 2014). Nonetheless, as implied by Melé
(2005), academics can act as ethical role models in that their behaviour sends signals to
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students that encourage and reinforce ethical motivations and dispositions.

Phronesis and forensic accounting research

Stone and Miller (2012) are critical of the dominance of large-scale quantitative research
methods within the accounting academy. They fear that this dominant body of research is
inadequate for providing research that is relevant and insightful for the purposes of
understanding and improving forensic accounting practice. They explicitly promote the
view that researchers should adopt a phronetic approach to the acquisition of knowledge
when researching forensic accounting issues. This is because they believe that no one
financial fraud[10] is like another and that each fraud must be understood within its
particular context, thus making forensic accounting issues less amenable to the application
of large scale quantitative methods whose findings reflect the average. Consequently, just as
virtue ethics demands that ethical behaviour must be seen within context, Stone and Miller
(2012) argue that forensic accounting researchers must adopt methods that reflect the
context-specific circumstances of forensic accounting practice.

Phronesis and the forensic accounting profession

With its focus upon the virtues and dispositions of the moral agent, virtue theory and
phronesis may appear to have relevance only to individuals but, in the context of a
profession such as forensic accounting, there are collective considerations as well. A
profession’s claim to status is built on public trust that the members of that profession will
act in the public interest, not the members’ self-interest. Virtue ethics is predicated on the
need for a moral agent to act for the “right” reasons, that is, to act for virtuous reasons, and
so serves as a reminder to forensic accountants that their ultimate ethical obligations go
beyond commercial objectives.
As Jennings (1991) and Lail et al. (2015) have identified, the difficulty in promoting public
trust in the professions is a problem of how to motivate professionals to commit to acting
virtuously. This is a particularly challenging issue in an environment where a commercial
logic dominates the work of forensic accountants, accounting training emphasises the
acquisition of technical competencies and skills and forensic accountants operate in a multi-
disciplinary context in which compliance with laws and legal process is necessary. Kemmis
(2012) suggests that a collective phronesis is possible within a profession but it requires the
professional community to commit itself to good practice. Public confidence in the forensic
accounting profession can only be achieved, for instance, if its members publicly
demonstrate their commitment to excellence rather than relying on references to codes of
conduct. It is possible to think of self-interested reasons why the forensic accounting
profession might commit itself to phronesis – for example, increased quality in services can
 lead to higher economic and social rewards – but this would be inconsistent with virtue Virtue ethics
ethics because the “good” actions are undertaken for the profession’s self-interest rather perspective
than because the profession intrinsically wanted to do the right thing (MacIntyre, 2007).
Commitment to a collective phronesis will require the forensic accounting community to
engage in internal and public debate about its responsibilities and accountabilities. Kinsella
and Pitman (2012b) suggest this requires an epistemic community[11] with shared values,
goals and ideals. As a still emerging sub-discipline within accounting[12], leadership by
senior members of the forensic accounting community may be required to develop an 163
epistemic community of forensic accountants.

Conclusions
The complex, multi-disciplinary environment in which forensic accountants practise
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requires them to deal with ever changing unstructured problems that are characterised by
uncertainty of facts and outcomes. Forensic accountants also frequently operate in legal
contexts in which they must possess a sound knowledge of laws, legal process and other
rules and regulations. In addition to legal knowledge, forensic accountants are also expected
to have strong technical skills in financial accounting, valuation and similar technical tools
and processes. The professions more generally have also been perceived to be increasingly
driven by commercial objectives and this has in turn threatened public confidence that the
members of those professions act in the public interest. All of these factors can encourage
forensic accountants to respond by adopting narrow rules-based technical solutions, but
such an approach restricts the freedom of forensic accountants to apply their professional
judgement.
This paper suggests that forensic accountants can grow and maintain the quality of and
public confidence in their services by adopting a virtue ethics approach to their practices.
Virtue ethics suggests that the “good” forensic accountant will not only be competent in
technical knowledge and skills and possess moral virtues such as courage and self-control
but, most importantly will develop the virtue of phronesis or practical wisdom. Phronesis
assists the forensic accountant to do “the right thing to the right person at the right time in
the right way for the right reason” (Sellman, 2012, p. 127). Virtue ethics requires that the
forensic accountant acts as the virtuous forensic accountant would act rather than
necessarily complying with some universal rule. Developing phronesis (like all virtues)
requires habitual training on the part of the forensic accountant who must learn from each
experience about which strategies and responses were successful and which were not. The
individual forensic accounting practitioner (and the profession collectively) can improve the
reliability and relevance of the evidence they generate and present by recognising that
phronesis requires practitioners to identify what they know and to have an awareness that
there are things about which they may be unaware. By knowing the limitations of their
knowledge and skills, practitioners can adopt strategies that lead to continuous
improvement. It is suggested here that the benefits of phronesis are universal irrespective of
whether the forensic accountant operates in a common law or civil law system because it
demands the application of virtuous acts within a specific context. Consequently, phronesis
is a valuable skill for all forensic accountants.
Kinsella and Pitman (2012b, p. 170) conclude that:
Phronesis provides a language and a vision for practice that resists a passive acquiescence to the
discourses of professional life that are increasingly instrumentalist, technicist, and managerial.
The professional is not simply a technician; rather, the professional is charged with the tasks of
making complex interpretive judgements and taking action amidst uncertain practice situations,
and of attending to the ruptures and disruptions of practice, as spaces for learning and for
 PAR professional development. Rather than dwelling in despair about the impossible binds in which
practitioners find themselves, we propose that practitioners and professional disciplines face the
30,2 complex and uncertain conditions of practice and embrace phronesis as a complement to
[technical knowledge and rules]. Phronesis is a concept of interest, and of hope, for elaborating
current conceptions of professional knowledge and for advancing an approach to practice in the
professions that seeks to fill a void in current practices—an approach that is felt as a morally
informed guiding force oriented toward a wiser path.
164
If these benefits are to be achieved in what is still an emerging sub-discipline in accounting,
forensic accounting needs to establish an epistemic community which is committed to a
common phronesis of professional practice. Such a community would develop education
programs in forensic accounting that go beyond the teaching of laws, rules and technique
and equip forensic accountants with skills in the application and evaluation of data and
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practices within ambiguous contexts. As previously mentioned, this would involve the
development of skills in reflection such as personal and professional values clarification. As
the classroom is inherently limited in its ability to capture the diverse and complex contexts
of the workplace, internships and work-based learning should have a central place in the
education of forensic accountants and require experienced mentors in both universities and
workplace learning. Forensic accounting education programs can be informed by a
phronetic-based research agenda that provides a platform for evidence-based research that
can also improve forensic accounting practice. This has been demonstrated in other
accounting contexts such as auditing (Howieson, 2013).
Strong leadership will be required if forensic accounting education, research and practice
are to embrace phronesis. Professional accounting associations can play an important role in
the establishment and promotion of a community of forensic accountants because their
public status lends authority and they already have an infrastructure for education and the
maintenance of quality. This is particularly true in countries such as Australia and New
Zealand where the collective identity of the forensic accounting profession is still embryonic
relative, for example, to that in the USA. It is anticipated that the increasing demand for
forensic accounting services will provide the impetus for the profession to embrace
phronesis as a means of demonstrating a commitment to serving the public interest.

Notes
1. To Aristotle, the term “good” is synonymous with “ethical”, as his Virtue Ethics approach is
based, in part, on the notion that being ethical means that one acts as a good (or excellent) person
would act.
2. Phronēsis has often been translated as “prudence” (Pieper, 1965) but because that term has a
specialised, if disputed, meaning in the accounting literature, it is not used in this paper to avoid
the possibility of confusing the reader.
3. A study by Adams et al. (1995) provides some evidence that accountants’ ethical decisions may
be dominated by a desire to comply with their professional code of conduct even when it conflicts
with their own moral position.
4. This has been a problem since time immemorial. Mawer (1926, p. 79) observed, for instance, that
in the Middle Ages “the Norsemen were much better at making constitutions and enacting laws
than they were at observing them when instituted, and the condition of Iceland has been vividly
if roughly summarized as one of ‘all law and no government’”.
5. Wyatt (2004) has made this argument in the context of the accounting profession.
6. See Nagel (1980) for a discussion regarding the nature of eudaimonia.
 7. See Prior (1991, Chapter 4) for a more detailed description of Aristotle’s intellectual and moral Virtue ethics
virtues. perspective
8. Aristotle was keen to emphasise the role of phronesis as a means to simultaneously integrate the
intellectual and moral virtues. The technically competent but morally bankrupt forensic
accountant is unethical but so too is the well-meaning but technically incompetent forensic
accountant who is unable to deliver on her “good” objectives.
9. Stone and Miller (2012, p. 56, emphasis in original) note that most financial frauds occur “in a 165
new, unique and particular context”.
10. Stone and Miller (2012) write only within the context of financial fraud but their general
argument regarding the context-specific nature of much forensic accounting practices could be
extended to other forensic accounting contexts such as the conduct of valuations or the
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presentation of expert evidence.

11. An epistemic community is defined as “a network of professionals with recognized expertise and
competence in a particular domain and an authoritative claim to policy-relevant knowledge
within that domain or issue-area. Although an epistemic community may consist of professionals
from a variety of disciplines and backgrounds, they have (1) a shared set of normative and
principled beliefs, which provide a value-based rationale for the social action of community
members; (2) shared causal beliefs, which are derived from their analysis of practices leading or
contributing to a central set of problems in their domain and which then serve as the basis for
elucidating the multiple linkages between possible policy actions and desired outcomes;
(3) shared notions of validity - that is, intersubjective, internally defined criteria for weighing and
validating knowledge in the domain of their expertise; and (4) a common policy enterprise - that
is, a set of common practices associated with a set of problems to which their professional
competence is directed, presumably out of the conviction that human welfare will be enhanced as
a consequence” (Haas, 1992, p. 3).
12. In Australia, for instance, there is no formal identifiable forensic accounting qualification or
certification. This may be one factor that inhibits the development of an epistemic community of
like-minded forensic accountants.

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Corresponding author
Bryan Howieson can be contacted at: [email protected]

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