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High Court Orders Accountant to Pay £300,000

I’ve always thought that accountants are supposed to save you money, but that didn’t exactly happen with one accountant in Ipswich.

Two brothers used an accountant for their metal recycling business over a 5 year period, and at first it seemed like he was doing a good job. They came to trust him, and gave him more responsibility in doing the books for their successful Limited Company.

It was all set to become a happy story until the brothers started to notice that something wasn’t quite right with the financial reports.

After a bit of investigating, it turned out the accountant had somehow managed to get £186,000 out of their business and into his own pocket. Not exactly the kind of service they were expecting I’m sure.

Not surprisingly they fired this particular accountant and confronted him about taking the money, and after a bit of back and forth he paid back the money and it looked like the matter was settled. However, they didn’t end up parting as friends.

Right after all of this happened the brothers decided to get the auditors in…and guess what? They discovered that during the 5 years this accountant was doing the books for this business he didn’t once prepare or submit a proper tax return, even though the brothers were paying him to do so.

As you can imagine they were not impressed when hearing about this, and rightly so took the matter to court where it eventually went all the way to the High Court.

It was there that a judge decided the accountant did the wrong thing, and ordered him to pay just over £300,000.

The brothers, although relieved that justice had been served, went on to say that the accountant was “not only a long standing colleague but also a friend of the family.” I’m sure they were disappointed with the whole thing.

I think this story can serve as a lesson to any business owner, contractor, freelancer, or self employed person out there.

The first lesson is you should always do your research when hiring an accountant by visiting a trusted website where you can find reviews and more information.

Next, be very careful about becoming too friendly with your accountant, and if you ask me, don’t hire your friends to do the books either.

As the brothers said themselves, they considered their accountant to be “a friend of the family” but at the end of the day that might have meant they trusted him too much.

Which brings me to my next point, and the biggest lesson of all from this story in my opinion…never give your accountant too much control, to the point where you just assume they are preparing and sending off your tax return and you never even check it.

Sure, you might pay your accountant to do this kind service, but make sure they are actually doing what they say, and spend some time looking over the books yourself.

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