When an accounting professional commits errors, omissions, or deviations from Generally Accepted Accounting Principles (GAAP) or Generally Accepted Auditing Standards (GAAS), the result can be enormous financial losses or penalties. Whether the mistakes were inadvertent or intentional professional negligence, victims may be able to hold the accounting or auditing party accountable.
Any company or individual that hires the services of a professional accounting or auditing firm has a reason to expect the work will be performed at the highest standard. Victims of accounting or auditing malpractice may be able to seek compensation for direct damages such as fines and penalties imposed by the Internal Revenue Service (IRS) as well as consequential damages like lost profits.
Denver Accountant Malpractice Lawyer
If you or your business incurred financial penalties because of accounting or auditing malpractice, you should immediately seek legal representation. Law Office of Jennifer L. Donaldson represents clients throughout Denver County and we also serve Adams County, Arapahoe County, Boulder County, and Jefferson County.
Jennifer Donaldson has been helping people all over Colorado for more than a quarter-century. Our firm offers a free review your case when you call (303) 458-5000 today to schedule a no-obligation consultation.
Colorado Accountant Malpractice Issues
- What types of malpractice can occur with accountants?
- What is the difference between GAAP and GAAS?
- What must be proven in an accountant malpractice case?
- What types of accountant malpractice claims are there?
- Who can be a victim of accountant malpractice?
Types of Accountant Malpractice in Denver
There are generally two types of negligence involved in Denver accounting or auditing malpractice claims:
- Gross Negligence – Intentional GAAP or GAAS deviations; and
- Simple Negligence – Inadvertent GAAP or GAAS deviations.
Difference Between GAAP and GAAS
There are generally two types of accounting or auditing malpractice in Denver:
- GAAP — The common set of accounting principles that are standard guidelines for preparing financial statements that used for record keeping, making financial and long-term decisions, and presentation to investors, creditors, and other users. Organizations that influence the development of GAAP standards include the American Institute of Certified Public Accountants (AICPA), Financial Accounting Standards Board (FASB), Governmental Accounting Standards Board (GASB), United States Securities and Exchange Commission (SEC), and other influential policy boards.
- GAAS — Three sets of standards (10 total) for reviewing financial statements. Since the passage of the Sarbanes-Oxley Act in 2002, the standards have been developed by the Public Company Accounting Oversight Board and put into effect by the Auditing Standards Board, a division of the AICPA.
Elements of Accountant Malpractice Claim in Colorado
As is the case with any professional malpractice claim, an accounting or auditing malpractice lawsuit will need to prove four things:
- The accountant or auditor had a duty to you to act properly;
- The accountant or auditor breached that duty to you;
- The accountant or auditor’s breach of duty was the proximate cause of your financial injuries; and
- You sustained compensable financial losses that you would not have otherwise sustained because of the accountant or auditor malpractice.
Common Examples of Accountant Malpractice in Denver County
Some of the most common types of accounting or auditing malpractice include, but are not limited to:
- Accounts Receivable errors;
- Billing fraud;
- Certified Public Accountant (CPA) fraud or other licensing fraud;
- Erroneous or improper advice;
- Failure to detect defalcations, properly audit financial statements, or provide correct tax advice;
- GAAP or GAAS deviations;
- Improper tax advice;
- Inventory errors;
- Report manipulation;
- Securities fraud; and
- Tax fraud, evasion, or other errors resulting in penalties.
Colorado Accountant Malpractice Victims
There are a variety of parties who may be harmed by accounting or auditing malpractice. These victims can include, but are not limited to:
- Company board members;
- Other individuals;
- Shareholders; and
Find an Accountant Malpractice Lawyer in Denver
Have you been harmed by accounting or auditing malpractice? The Law Office of Jennifer L. Donaldson fights for clients harmed by professional negligence in Denver as well surrounding areas, including Arvada, Aurora, Boulder, Centennial, Lakewood, Littleton, Longmont, Thornton, and Westminster.
Denver personal injury attorney Jennifer Donaldson has received the highest available AV® Preeminent™ Peer Review Rating from Martindale-Hubbell® because of her legal ability and professional ethics. She can review your case and discuss your legal options when you call (303) 458-5000 or submit an online form to set up a free, confidential consultation.