Importance of Hash Values for forensic accountants

What is Hash Value ?

Hashes play a role in security systems where they’re used to ensure that transmitted messages have not been tampered with. The sender generates a hash of the message, encrypts it, and sends it with the message itself. The recipient then decrypts both the message and the hash, produces another hash from the received message, and compares the two hashes. Hash Value is generated by a formula in such a way that it is extremely unlikely that some other text will produce the same hash value.

Importance of Hash Value for Forensic Accountants

Certified forensic accounting professional needs to ensure that the digital data and records provided for examination are accurate and complete. Frequently, data that the forensic accountant gathers come from different sources and systems and therefore, Certified forensic accounting professional could be at risk of missing valuable information. The data can often be categorized into accounts that may not have been properly extracted during the collection process, potentially limiting the analysis of relevant accounts. These are just a couple of examples of potential challenges one might experience when collecting data. Regardless of the source of information, there are various methods of testing whether the data received is complete and has been normalized in a way that would be acceptable to the adjudicating authority.
Completeness testing can range from reading and understanding the programming script used to extract the population of data to the reconciliation of processing metrics. To assess completeness and accuracy, the forensic accountant could request a number of records that can be used to compare the converted information with what would be expected. One comparison is to calculate hash values of all the records converted and  compare them to predetermined values prior to conversion. This also can be performed on designated field and column totals. If an IT specialist is assisting in collecting data, it may often be helpful for the Certified forensic accounting professionals to be present to watch the extraction process. Often the forensic accounting professionals may notice additional fields of interest to include in the population of the data to be extracted that would otherwise have been missed. Watching and understanding the logic of the script used to extract the data also helps to gain comfort with completeness; i.e., date ranges are proper, account ranges are what the forensic accountant is looking for, etc. The forensic accountant can also request a sample of records, typically the first 100, to be printed out to confirm understandings of layouts and data. When used in a forensic engagement, the standard of care and the number of procedures required to perform these reviews will be significantly greater and will need to be appropriately documented. Each conversion will require its own controls based on the risks of the conversion and importation. It is the forensic accountant’s responsibility to ensure the complete and accurate conversion of the data files and to ensure that the materials they are working with meet the quality control requirements of the particular engagement.