John is a new accountant in a boutique firm specializing in corporate restructur

Question

John is a new accountant in a boutique firm specializing in corporate restructures Corp solve. He graduated two years ago. One of the senior partners gives him a file to work on and says….’ these are old clients of ours and they have several companies running three different businesses, vegetable couriers to supply top end restaurants, Top Veg, concrete slabs for gardens Top slabs and waste disposal Top trash. All companies were shelf companies provided by Smash lawyers. The vegetable supply company Top Veg is losing trade due to rotting of vegetables in the fields in Virginia after the rain events in 2016. It has several idle trucks and drivers and liabilities due to a road accident . John is told by the senior partner to make sure that Top Veg is wound up with no assets to the creditors. John contacts Smash lawyers explains the problem above and Smash Lawyers tells him to 1 wind up Top Veg 2 make the accountant show that Top veg is insolvent 3 get signatures of the Directors of Top Veg on these documents. DISCUSS The liability of John, Liability of Senior Partner and Liability of Smash Lawyers.

Explanation / Answer

Liability of John (accountant)- An accountant's liability while performing professional duties are, accountant is responsible for a client's accounting misstatements, he is responsible for fraud or misstatement, he should have knowledge and should adhere to all the accounting standards. Accountant negligence will leads him to face legal charges from company, or investors or from creditors as they rely on accountant's work.

                In this case company Top Veg is losing its business due to rotting of vegetables in fields in Virginia due to heavy rains in 2016. Here John (accountant) has not committed any criminal act, any breach of trust or breach of contract. Hence John's liability will be limited to only extent to his duties or skills or specialization. and also his liability is limited to performing his professional duties and also showing company as insolvent as advised by Smash Lawyer.

Liability of Senior Partner (assumed as Company Financial advisors) - Senior partners in this case is assumed as Financial Advisors and assuming that he has discussed the issue of Top Veg losing business due to rotting of vegetables, with the company board of directors and as per the board's decision to wound up compnay he has provided the file to John for further process. Here Liability of Senior partner is limited to similar like John's as he is not committed any criminal act, breach of trust or breach of contract.

Liability of Smash Lawyers: Lawyers liability is always answerable in law, which can be any civil law or criminal law arising from various areas of business or law. In this case he is working to close the Top company, as the company is insolvent and all the business is lost due to Virginia rain affect, Here his liability is limited to the professional duties which he performing as per his engagement letter.

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