Accountant's Liability
Barron's Accounting Dictionary:
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Accountant's Liability
Potential legal obligation of an accountant who commits fraud or is grossly negligent in the performance of professional duties. The term typically applies when an auditor conducting the attest function does not employ GENERALLY ACCEPTED AUDITING STANDARDS (GAAS) with sufficient care. To avoid liability, the accountant must be knowledgeable about the accounting profession's authoritative pronouncements such as fasb statements and AICPA statements on auditing procedure as well as SEC accounting series releases . An accountant who violates the established rules and guidelines can be held legally liable to parties retaining him and those relying on work performed (e.g., investors, creditors). Most accounting practitioners carry malpractice insurance.
See also negligence.
ACCOUNTANT'S MAGAZINE, THE journal founded in 1897, originally published monthly by the Aberdeen, Edinburgh, and Glasgow chartered accountants' societies. The institute of chartered accountants in scotland , founded in 1951, later adopted this magazine as its monthly journal. Subject matter includes international accounting, accounting education, information systems, financial accounting, managerial accounting, and legal topics.
See also negligence.
ACCOUNTANT'S MAGAZINE, THE journal founded in 1897, originally published monthly by the Aberdeen, Edinburgh, and Glasgow chartered accountants' societies. The institute of chartered accountants in scotland , founded in 1951, later adopted this magazine as its monthly journal. Subject matter includes international accounting, accounting education, information systems, financial accounting, managerial accounting, and legal topics.
| Accountant In Charge, Accountant, Accountancy | |
| Accountant's Responsibility, Accountants For The Public Interest (API), Accountants International Study Group (AISG) |
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Accountant's Liability
Investopedia Financial Dictionary:
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Accountant's Liability
An accountant's legal liability while performing professional duties. An accountant is liable for a client's accounting misstatements. This risk of being responsible for fraud or misstatement forces accountants to be knowledgeable and employ all applicable accounting standards. An accountant who is negligible in his or her examination of a company can face legal charges from either the company or investors and creditors that rely on the accountant's work.
Investopedia Says:
Accountant's liability adds an element of pressure to an accountant's performance of duties. An accountant's actual participation in a fraud can be hard to prove because management could be committing the fraud, which the accountant failed to notice. This makes the accountant legally liable for being negligent of fraud or misstatements, even if he or she had no direct hand in committing them.
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Dictionary of Accounting Terms. Copyright © 2010 by Barron's Educational Series, Inc. All rights reserved.
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