The financial world can be complex and even the savviest among us can find the world of financial records, tax returns and profit and loss accounts confusing. Therefore, to ensure our finances are kept in order, many of us turn to a professional accountant to handle our affairs.
From business accounts to personal finances, when we appoint an accountant to work on our behalf we are putting our trust in their skills, experience and training.
Thankfully, in most cases, our trust is well placed, and our finances are managed with care and diligence. However, if you find that this has not been the case, and you are facing financial loss due to what you believe to be the negligence of your accountant, there may be a case to answer.
We outline some of the things you need to know before pursuing legal action…
What is duty of care?
Duty of care is very important. Essentially it sets out the responsibility a professional has to those using their services. In terms of an accountant this means correctly preparing accounts and being sure not to make any omissions or do anything with the accounts that could result in harm to the client and/or their finances.
What is professional negligence?
Professional negligence occurs when there is a breach in the duty of care a professional should provide. In essence, the accountant’s actions must fall below the standards expected from an accounting professional.
While you may feel that the service your accountant has provided is negligent, be aware that professional negligence is different from simply receiving bad service. To prove negligence, you must demonstrate first that you have suffered financial damage as a direct result of the advice given to you by your accountant for it to be classed as such.
There are time limits around professional negligence claims, usually six years, though this can vary depending on the case.
Taking action against your accountant
If you feel your accountant has not acted in your best interests and their advice has fallen below the standards you could reasonably expect from an accounting professional, it may be appropriate to take action.
When suing your accountant, you must prove that their advice has resulted in a financial loss. Be sure to keep as much paperwork as possible, to add weight to your claim and to demonstrate negligence.
Before court action
Resolving matters before court action is taken is usually in all parties’ best interests. The pre-action protocol aims to encourage the resolution of disputes before court proceedings are required and it must be shown that the protocol’s guidelines has been followed before court proceedings can commence.
A clear reason many people choose to pursue a professional negligence case is around the compensation which could be awarded. The amounts awarded, if successful, vary depending on the case, but the aim is always to ensure the compensation is appropriate to the losses faced.
If you have faced financial losses due to advice from your accountant and feel you have a case for professional negligence, visit Claims Against for straightforward, jargon-free advice on your next steps.
If you’d like to find out more about the legal services offered by Smith Partnership, don’t hesitate to contact us via firstname.lastname@example.org. Alternatively, speak to a member of our team directly on 0330 123 1229.