can i sue my accountant if i get audited?

Discussion in 'Accounting and Tax' started by Georges, 17th Sep, 2007.

  1. Georges

    Georges Member

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    Last year I bought a land with a friend, using a trust name. After selling off the land and closing the deal, my friend suggested that my account is "too expensive" and that his wife has a friend who is an accountant who will 'look after us' (my a-ss).

    Anyway, when the bill came it was like 3 x the price of my accountant!

    Plus, this accountant friend of his can;t speak proper english and can only speak mandrin. PLUS, she did not give us proper advice as to how to negative gear with the trust, and the way she recorded it made it not legit for us to claim tax deduction. (We took the loan in our personal name, and the property in the trust name. But this accountant didnt record us buying units in the trust, therefore we cant negative gear with out personal name).

    After I spoke to my accountant, he said he could get it fixed for me to claim tax deduction on the interest paid, provided I issue a notice to the other accountant to make ammendments to the trust tax return. Well, I have been trying to chase her to ammend it, and she said it wasn't her fault that she recorded it that way. I said she did not give us proper advice, but she said we signed the tax return. I said you are the accountant you should tell us the correct way to do this, she said she thinks this is the right way to do it.

    If I get audited can I take legal action against that accountant?
     
    Last edited: 17th Sep, 2007
  2. LynnH

    LynnH Member

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    My question is: how on earth can she be licenced as a Tax Agent in Australia if she can't speak English???

    Cheers
    LynnH
     
  3. Georges

    Georges Member

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    oh she can speak english, but i dont understand her cos the grammar was all over the place. I'm asian too but it was really hard communicating with her in english, she didn't understand what I said when I explained to her what my accountant wanted her to do.

    Even my friend told me to speak to her in mandrin cos "she can't speak english".

    Now thinking about it I am not sure if she is registered CPA or not:confused:
     
    Last edited: 17th Sep, 2007
  4. Georges

    Georges Member

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    Now the summary is:

    -Chinese accountant screws up
    -My own accountant try to help me claim tax deduction, provided I ask the chinese accountant to fix up the trust statement/report.
    -I asked chinese accountant to change the report
    -She said ok over the phone and asked me to email the info, but then later doesn't reply to my email when I provide her with the info. Sort of like disappeared. ( I have a copy of my emails requesting her to ammend it).

    -If I get audited, who the heck gets the cane?

    -Can I complain to some accountant institute?

    _If she says ok to change it and asks me to pay more, should I????
     
    Last edited: 17th Sep, 2007
  5. Mr. Fabulous

    Mr. Fabulous Thought Criminal

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    Summary: I didn't bother looking into this situation closely enough to determine whether this person was the best person for the job. Now everything is stuffed up and I'm going to blame her for something that's my fault!

    Mark
     
  6. Rixter

    Rixter $uper Investor (Retired)

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    George,

    Id be rechecking the paperwork your accountant gave you for signing..You may well find you have signed all responsibility or liabilities off the accountant.

    Worth a check.
     
  7. Georges

    Georges Member

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    We got an accountant. His wife told us is her friend, and 'she can do it, she has handled trusts and company tax returns before'.

    How was I suppose to know if she could do it or not before she does it?

    Mark,
    are you saying if an accountant, lawyer or architect or engineer doesn't perform, it's my fault for getting their service in the first place? If they screw up, don't they have Professional Indemnity Insurance? What about those Insitutes that regulate these professions? "Serve you right Mr consumer, getting the wrong accountant/architect/engineer is all your fault"?

    I know personal responsiblity has its place, but if say an engineer screw you up and building fell down you gonna go "it's my fault, i did it"???
     
    Last edited: 17th Sep, 2007
  8. Mry

    Mry Member

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    The name of this thread should be "I am having a tiff with my accountant and want to vent".

    I'd have doubts about an accountant who couldn't speak English well enough. Tax Returns are in english, our tax laws and rulings are in English as well. I think it would be prudent here to use some Latin - Caveat Emptor.

    Besides, this is so easy to fix. Get your accountant a copy of the tax return and get him/her to fix it. Amending a trust return can be done in 5 minutes tops.
     
  9. BoatBoy

    BoatBoy Member

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    She can handle trust's and company tax return's.

    Just not very well.

    Dave
     
  10. Mr. Fabulous

    Mr. Fabulous Thought Criminal

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    Hi George,

    I understand your frustration, I know what it's like to work with people who aren't right for the job at hand. Even though I was told by people that these particular 'professionals' were the right people for the job. You know what, I learnt two very important things from the experience.

    1. Look at who is giving you the advice. Interview them. Ask them how much experience they have dealing with the issues that you will be facing. After all they are working for you. Ask the right questions. Get enough of an understanding of your structure to be able to ask the right questions. How is your team supposed to do the best job they can helping you when you don't know enough about your project yourself? Relying exclusively on your employees for optimal results only leads to trouble.

    2. Never blame anyone else for choices you make. It gets you nowhere and you will probably miss the valuable lesson behind what happened. Suck it up and take it like a man and look at what you did wrong. If you had gotten an accountant who you were confident knew what they were doing and demonstrated to you beforehand that they did know what they were doing and asked the right questions, then maybe everything would have been fine.

    Using an accountant that your friend's wife recommended ended up being bad mojo. Why take a recommendation from someone who probably has little knowledge of what it was you were trying to accomplish. That's like taking advice on property from a taxi driver who doesn't even own his own home.

    Mark
     
  11. secret squirrel

    secret squirrel Member

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    i have to agree mark. my english bad but advisors very good. some qcs and all qualified. all speak good english unlike me. why you go to accountant and not ask questions. first interview you know they speak poor english. then ask about hybrids and they do not know. i agree with mark. you not do your due diligence properly. so you to blame. bad service in the end but you should have asked lots of questions at beginning. glad you not in development because you go belly up. need to ask lots of questions before you make commitments. write it off as bad experience and move on.
     
  12. Georges

    Georges Member

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    Thanks all,
    but firstly I wasn't in the country and my business partner in Melbourne took care of selecting the accountant and managing the stuff.

    So it wasnt me who selected that accountant either.
    NOw my business partner has quit, Im the only director left in the company/trust.
     
  13. redsquash

    redsquash Member

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    You dont need an accountant to make amendments to a tax return.
    You can do it yourself.
    The accountant is just acting as your agent.

    As MRy said, just get your new accountant to do what is required and the matter is done. I cant see any legal connection bewteen the old and new accountant
     
  14. Pushka

    Pushka Member

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    One thing I find very difficult is that I may give my Accountant figures that I know to be accurate. Then the accountant does 'things' with them, like the depreciation amounts etc etc at varying percentages. I rarely fully understand the reports I am expected to sign; I have to trust the accountant that he has got the figures correct because I dont have the software to check them; yet I am the one responsible for the signing.
     
  15. Mry

    Mry Member

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    I love my job.
     
  16. sailor

    sailor Member

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    I think selecting an accountant, is much like selecting a lawyer, GP, mechanic, plumber, electrician, hairdresser, dentist, depreciator, etc. They are all casual employees of mine. I choose them very carefully, as I don't have much knowledge in their respective areas of expertise, and they are not cheap employees. I need them to run various parts of my life...with minimal supervision. I need to be able to rely on them to do a great job.

    So I see my life as a corporation. I'm the Managing Director, they are my department heads (and they have their own staff). Selecting these experts takes time, like it does to select any other staff member. I generally do the traditional interview and have a huge list of questions I ask them. I ask for a personal resume and references (and I check the references).

    I make it quite clear that I'm the boss and I'm going to be relying on their expertise and experience to do my work. If they do a good job, I will recommend them to all and sundry (free advertising and referrals for them). In return I will pay my accounts promptly. If they do a bad job, they will get the sack and be smartly replaced.

    I had occasion to sack my accountant last year. She was replaced within a month. I did a lot of background checking on my new accountant before he was employed. He's now left the firm he was with, and I'm just going to follow him to his new employer. I've invested a lot of time and effort with him, as he has with me. We have developed an excellent and very honest working relationship...not going to pass that up too quickly. He is my valued employee.
     
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  17. nonrecourse

    nonrecourse Banned

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    Taking Responsibility

    :eek: This thread is a good example of why you must not hand over total responsibility to your adviser's be it accountant, Solicitor or business partner. Blaming or suing someone else is wasted energy. Learn from your mistakes so that you are never again financially compromised.:eek: