Accounts question

Out of interest and totally nothing to do with anything whatsoever but...

Supposing forensic accountants turn up cock-up's by a previous company accountant who covered up his/her cock-up's from the company owners or share holders. Would that company accountant be liable in any way or because he was employed and no longer employed means he/she's scot free?

Like I said, not a Cardiff question, but just a general accounts question, just because we are debating forensic accountants today.

Keith? Any ideas?

Out of interest and totally nothing to do with anything whatsoever but...

Supposing forensic accountants turn up cock-up's by a previous company accountant who covered up his/her cock-up's from the company owners or share holders. Would that company accountant be liable in any way or because he was employed and no longer employed means he/she's scot free?

Like I said, not a Cardiff question, but just a general accounts question, just because we are debating forensic accountants today.

Keith? Any ideas?

If a previous company accountant was also a director and was proved to have been involved in such a cover up , then he would face certain disqualification from being a director from between 2 and 15 years , expulsion from his professional body and possible criminal charges. Whether or not he is a current employee would be irrelevant.


Keith

So is there a time limit on that and what if he wasn't a director but just an employee? Or I have I read your reply wrongly and a chief accountant is a director?

So is there a time limit on that and what if he wasn't a director but just an employee? Or I have I read your reply wrongly and a chief accountant is a director?

A chief accountant needn`t be a director.Without getting into too many technicalities , he may be treated as one in law (known as a shadow director) in some cases if he was someone on whose instructions the other directors were accustomed to acting. This was set up to cover cases where someone acted exactly as a director was , but didn`t register him/herself as a full director.

In CCFC`s case though , the most senior accountant now (and also under Ridsdale) is also a director.

As an employee only obviously the director disqualification rules don`t apply , but the professional conduct risk does if the accountant in question is fully qualified under one of the major accountancy bodies (ACA, ACCA etc)

The time limits involved would depend on the nature of any alleged offence , but could be up to 6 years.

The other factor to take into account is who makes a complaint. In your hypothetical case , if it is the other directors or shareholders who have lost out by the offence then , unless it is a criminal offence rather than a civil one , it is they who would have to bring any legal action.

Keith

Thanks Keith. Like I said though, nothing to do with Cardiff, just something I thought of due to thie forensic subject coming up.