The Internet: The 1st Forensic Medium.

Guess what the latest mandatory training session is these days for many of our most seasoned business reporters? How to get along with others? No. Sensitivity training toward extraterrestrials? Wrong again. Forensic Accounting, that’s what.

Forensic Accounting (FA), the mother of all accounting analyses is being taught to America’s business trade media reporters, so that these folks don’t miss another accounting scandal like Enron.

Once practiced by an incredibly small universe of specialists who were trained in Forensic Accounting for the (unlikely) scenario that a client’s financial numbers might be used and/or disputed in the courts, FA is the process by which the American judicial system uses to substantiate profit and/or loss, vs. accounting loophole mumbo jumbo that’s been passing for facts in the last decade.

Houston, we have a problem. The numbers have been spun out of control. Our nation’s leading business online and offline news publishers are realizing their reporting crews need to be trained in the extremely complex terrain of forensic accounting, so that they can unearth questionable quasi-legal loopholes that have allowed public companies to hide problems which were once normally reported with basic, straightforward, stock price-dropping language.

Most of the FA training isn’t focused on investigating public companies either; it’s aimed at de-mystifying big 5 accounting firm statements. What folly we find ourselves in today! We have to question the very nature and honesty of our largest financial institutions’ notarized statements -the referees initially hired to keep the playing field level. Shame, shame!

Unfortunately, spin has been institutionalized at these once-objective venues of business intelligence. How did it happen? One questionable step at a time. If the road to hell is paved with good intentions, consider how the devil slowly but surely corrupted a bean counter’s world.

Picture yourself, junior associate sweating over a hot calculator at work, pocket protector and all, analyzing the tax code when you find your mind going back to some obtusely worded clause that gives you enough wiggle room to help a client move a credit into a debit which will change the nature of this quarter’s financial ROI. You’re not a criminal, you’re a hero, or so everyone says as they green light your recommendation. What was yesterday’s borderline “no no” has become today’s great idea. And if the IRS spots it, assuming they push for a complete audit, you’ve already gotten your defense ready. Besides, you’ll likely get a bonus.

Put any number of examples like this together, or more importantly, take the entire accounting process, push everything to the limit and suddenly, when America’s 9th largest corporation evaporates into ashes in less than 6 months, no one in the trade is terribly surprised, or does anything to stop it. How can they? Everyone’s working feverishly to keep other financial debacles from following.

No one believes “the numbers” anymore, so when our business journals must train their reporters in Navy Seal level investigative accounting gobbledygook as a standard part of the business news beat, it’s no wonder that when it comes to the Internet’s numbers, few people get terribly jazzed at the client for increasing online budgets. Why?

Because the framework of what passes for counting beans these days has devolved into smoke and mirrors, bad arithmetic or worse, questionable figures that disguise real problems. The pre-post 9/11 cynicism is that good figures must obviously have been cooked to some degree. With the economy and the American public still in a post-nightmare (du jour) syndrome, few people believe it wise to get too worked up about anything positive, especially concerning the late 90’s phenomena called the Internet, a medium created almost entirely out of spin.

It’s not out of order to be circumspect in the statistical rat race we call ROI. Numbers can hide a lot of mistakes. Who wants to hand in a report that shows bad news when one can re-position charts slightly so that the news ain’t so bad. It’s also in our advertising and culture…you know, “best foot forward.”

If one looks to the current White House administration, we find a group of folks not unfamiliar with cooking a book or two. The state of Florida comes to mind for some reason.

What’s truly ironic out of all this is that the Internet is really the first forensic medium to provide true clarity of performance. Its counting methodology, the stability of its technology and the sheer volume of consistent, increasing usage demonstrates that one can believe in something.

There are a number of new media analytics tools in the marketplace now which help measure media data in more sophisticated ways than ever before. Check out Jupiter’s LiveMetrix, Centrport, Fattail, FastForward Inc., eWOMP or eStara. These companies are further dimensionalizing the media analytics process.

Now is obviously the time to plan ahead. With 2003 planning about to begin in the next few months for many America’s leading brands, constructing an online media process that’s going to automatically provide learning, whether it’s about the target profile, the purchase decision, the competitive set or your brand’s price points are all measurable elements that will help your client be smarter with their marketing spend.

The quality and amount of online data that’s available to marketers has never been as robust. It’s up to you to know the tools that generate what kind of learning that will melt the cold cynical heart of the most disbelieving client. Once clients and agencies become more familiar with these tools’ capabilities, the greater they will enjoy the bean counting side of the Internet. As compared to the accounting industry, clients’ faith will grow over time with the Internet, the one Forensic Medium worth believing in.

By Tim McHale
Courtesy of http://www.MediaPost.com

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