Relying on the services of an accounting professional is a wise choice for anyone whose financial documents and tax returns require more than the most basic analysis. The knowledge and expertise that they possess should provide you with confidence that you are in full compliance with all of your reporting obligations and that your records are meticulously and accurately prepared. If, however, your accountant falls short on the service they’re providing, you may be a victim of negligence, and that can have a direct impact on you. If you suspect fraud or feel that your accountant is betraying your trust, it is essential that you document your suspicions so that an expert can advise you as to whether you are eligible to file an accountant malpractice claim.
In order to be successful, an accountant malpractice claim must include certain specific elements, including an existing professional relationship between the accountant and the client; a breach of duty on the part of the accountant, demonstrated by their failure to follow the law, Generally Accepted Accounting Principles, or other standards; actual provable financial losses as a result of the accountant’s action or inaction; and the ability to prove that the accountant’s action or inaction was the cause of the damages.
The first step in pursuing an accounting malpractice claim is to seek the guidance of an experienced, knowledgeable attorney who can review the specifics of your situation and tell you whether all of the necessary components for filing a claim exist. The best way to demonstrate your predicament – both to your attorney and eventually to a judge and jury – is by documenting the errors that your accountant has made. This includes saving all pertinent correspondence, the materials that you provided to the accountant, the accountant’s work product, and proof of the losses that you have suffered.
It is important to remember that a simple error is not proof of malpractice. If your accounting professional’s mistakes did not result in a financial loss, or if you are simply unhappy with the results that they have presented (rather than those results being a mistake), it is not the same as negligence. The types of errors that may represent negligence include tax reporting errors, errors in financial statements prepared for the purpose of selling or purchasing a business, and errors made during an audit.
If you would like to discuss whether your situation represents accounting malpractice, our experienced attorneys are happy to help. Contact us today to set up a time to meet.