Accounting Malpractice: How Do I Know I Need an Attorney?

Atlanta GA

26 January, 2023

10:57 AM

Description

Perhaps you are the owner of a new start-up or an executive at a large corporation, and now, you’ve realized that the accountant hired to keep your books has made grievous errors that will end up costing your business significant money. Or maybe you are an accountant who has been accused of violating industry standards. Either way, you are in need of an accounting malpractice attorney who can help you best protect yourself, your reputation and your business. Are you a victim of accounting malpractice? Victims of accounting malpractice require the help of an accounting malpractice attorney who will be able to review the conduct of the accountant to determine how the malpractice occurred. Common examples include: Providing incorrect business valuations Overbilling for services rendered Overall dishonest practices Deviation from standards established by the GSBA, FASB, or PCAOB (see below) Improper tax return calculations, often leading to penalties Incorrect tax liability advice given Accounts receivable errors Improperly conducted audits Misrepresentation or omission of material facts Poor recordkeeping Not complying with governing state and federal laws Failure to recognize and report fraud and embezzlement Assisting in fraud, embezzlement and tax evasion Failing to adhere to accountant/client confidentiality rules License fraud Manipulation of reports to improve the value of company stock If you suspect your accountant has committed any of these forms of malpractice, it is time to contact a knowledgeable malpractice attorney.  Are you an accountant accused of malpractice?  A solid, quality reputation may take years to build, but can be smeared very quickly. As soon as you suspect an accusation of malpractice, you should reach out to an attorney so that he or she will be able to head off any damage to your reputation.  What is needed to prove accountant malpractice? There are several elements that must be proven to be successful with an accounting malpractice claim: There must exist an accountant/client relationship wherein the accountant owed the person (or entity) presenting the claim for malpractice an affirmative duty of professional care, The accountant engaged in negligent conduct which resulted in a breach of the duty of professional care, Due to the accountant’s failure to comply with their duty of professional care, their client suffered a monetary loss, and There is a link between the accountant's breach of duty and the monetary loss suffered by the client, and that link is able to be proven. It is essential for a malpractice claim to be successful that all of the above criteria be met. Without a duty of care, a breach of that duty, a financial loss, or a causal link, a malpractice claim cannot succeed. How do accountants engage in malpractice? Accountants are professionals held to high standards. From preparing taxes to analyzing financial records, they are involved in a large array of financial matters, and a high degree of trust is placed in the quality of their work. Some of the most common standards that accountants deviate from include: Exercising professional care Failing to meet requirements for continued licensing Deviating from the accountant/client confidentiality rules Engaging in conflicts of interest Failing to obtain sufficient data to effectively reach a sound conclusion Performance of duties outside their realm of competency Many times, accountants are under pressure to produce reports that indicate a certain level of success to meet the expectations of board members, owners, executives, or management. This pressure, combined with the levels of access accountants generally have to money and financial data can work to create an environment where malpractice is easy to commit.