Whether it involves a simple reconciliation of numbers or a complex forensic analysis, accounting is part of almost every type of business transaction. This often places accountants and other tax professionals in the middle of disputes. It is important to understand when an accountant may be held liable and how to protect yourself if you become involved in a dispute.
Accountant Professional Conduct
Like other licensed professionals, accountants must abide by the rules of professional conduct. The American Institute of Certified Public Accountants (AICPA), the world’s largest member association, assisted with developing the “Generally Accepted Accounting Principles” (GAAP). In addition, Chapter 473 of the Florida Statutes provides for the regulation of accountants licensed in the state. Accountants should be familiar with and follow GAAP and Florida Statutes. A violation of these rules may subject an accountant to civil liability. See §§ 473.322(2) and 473.323, Florida Statutes.
When Is an Accountant Liable?
An accountant who makes a mistake on a personal tax return may not need to worry about liability because the Internal Revenue Service (IRS) will typically hold the taxpayer responsible for errors on their return.; However, when an accountant commits errors during the performance of more complex business accounting services, the accountant may be liable to a company, investors, and/or creditors that relied on the accountant’s services. See First Florida Bank, N.A. v. Max Mitchell, Co. 558 So. 2d 9, 10 (Fla. 1990). An accountant could also be held liable, and therefore financially responsible, for losses resulting from mistakes or misrepresentations. To be held liable, however, it must be proven that an accountant breached his or her fiduciary duty to use reasonable and ordinary care owed to the party claiming damages.
Consult the Tampa Bay Accountant Liability Attorneys at Lieser Skaff Alexander
Whether you are an accountant facing liability or a business that has suffered losses because of what you believe to be negligent accounting practices, it is imperative that you consult with one of our experienced accountant liability attorneys immediately. We will review the transactions in question, evaluate liability and discuss your legal options with you. If you become involved in litigation, we will aggressively advocate on your behalf inside and outside the courtroom.