Brought to you by
Thomas Reuters Logo

Award winning Digita Software from Thomson Reuters.

Save content
Have you found this content useful? Use the button above to save it to your profile.

Accountancy software can protect against negligence claims

6th Nov 2006
Brought to you by
Thomas Reuters Logo

Award winning Digita Software from Thomson Reuters.

Save content
Have you found this content useful? Use the button above to save it to your profile.

Rising rates of negligence claims against practitioners based on taxation and accounting errors can be arrested if software incorporates risk management and review tools that minimise the possibility of human error.

A recent survey by Alexander Forbes International revealed that tax negligence claims against practitioners rose from 25.6% to 27.2% of the total during the 2005-6 financial year, much of which could have been avoided. This figure is of particular concern when audit negligence claims, an area where accountants would expect a significant degree of risk, are a comparatively low 3.8% of total claims.

David Johnson, the product manager for Digita’s personal tax software, said: "Risk management begins at data entry level. The trick is to use software that will minimise the possibility of error by filtering out inappropriate controls and changing the questions asked of the user.

"Changing the question encourages correct data entry, the first and highest area of risk. Filtering out inappropriate controls reduces the opportunity for error and encourages rapid data entry. We have also developed software that actively interrogates the validity of information that has been entered and reports errors and conflicts to the user.

"Clearly, the most efficient way to manage and control the quality of the compliance process is to use a solution that completes the process in the most cost efficient way and with no opportunity for error".

David Johnson also emphasised the necessity of taxation software using an effective client review tool to provide an instant ‘full picture’ of a clients’ current and prior year tax returns in a structured way with the ability to flag up special issues that require attention. If this is combined with an initial review undertaken by the software itself then greater accuracy and a reduction in time spent on review can be achieved.

David Johnson concluded: "Rising rates of negligence claims need to be addressed and the last thing practitioners need is to expend more time and money having returns checked and double checked.

"The opportunity to reduce both risk and cost is a rare combination. Digita’s personal tax software can do this and can also give active assistance in identifying tax efficiencies for each client based upon analysis of individual client data."

Ends

Further information is available by calling 01395 270 311, faxing 01395 268893 or mailing [email protected]

Release issued on behalf of Digita by:

Proteus Media Limited
Woodwater House
Pynes Hill
Exeter EX2 5WR

Tel: 01392 687477

[email protected]

For further information:

Jerry Rihll or Karen Green on 01395 270273
Or
Neil Devons, Proteus Media Limited on 01392 332833/07711 137787

Notes for Editors

Digita is a financial services technology company. Founded in 1986, the Digita team of more than sixty software specialists serves a professional client base that includes over 3,000 accountants.

Digita is the only UK software developer in the professional accountancy sector to be accredited by Microsoft with the ‘designed for Windows XP” and authorised to use the logo. The company is a Gold Partner of the Microsoft Corporation.

Digita also provides consultancy and Internet services to the HRMC, Bank of Ireland, Lexis Nexis Butterworths Tolley, NatWest Bank and other leading corporations.

For more information about Digita visit www.digita.com

Tags:

Replies (0)

Please login or register to join the discussion.

There are currently no replies, be the first to post a reply.