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Do I need professional indemnity insurance?

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Dear all, I will be undertaking some contracting work for a client soon. I will be commencing work from 1st April, and my duties will be bookkeeping, management accounts, year end accounts, corp tax comps, and supervising junior staff with general accounts. I have been an ACCA member since 2014. Do I need professional indemnity insurance while I am working for them ? Thanks 

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By Moonbeam
18th Mar 2019 18:12

Yes of course you will. Suppose you make a mistake.

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By Accountant A
18th Mar 2019 18:42

If you are in practice, do you not already have PII?

Why would you not need it if you will be acting as self-employed? Mind you, I don't think it's clear from what you said that this isn't a short-term (maybe part-time?) employment.

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Replying to Accountant A:
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By raj1234
18th Mar 2019 18:47

I am currently employed as an accountant working in industry. The contract I will be doing is for a minimum of 2 months...

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By lesley.barnes
18th Mar 2019 19:16

If you are working as self employed you would need indemnity insurance. I'm not a member of ACCA but my professional body insists as part of my practice certificate I have insurance I think ACCA would be the same . You would be taking a huge risk and you could be sued if something went wrong. If you are an employee of the company you are working for you don't need insurance.

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By andy.partridge
18th Mar 2019 20:28

Nah, just chance it, mate. I mean, what kind of damage can you possibly do in just a couple of months? If you have to fork out a few hundred quid for insurance too it’ll hardly be worth bothering.

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By penelope pitstop
19th Mar 2019 01:48

What is the most you could be sued for?

Are all of your assets in your spouse's name?

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By ireallyshouldknowthisbut
19th Mar 2019 08:41

Id ring the ACCA myself, Id imagine their answer would be "and a practising cert sunshine"

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By MissAccounting
19th Mar 2019 09:08

Dont worry about PI or a practicing certificate, what could possibly go wrong?!

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Replying to MissAccounting:
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By raj1234
19th Mar 2019 12:08

I agree, how is it any different when being an ACCA member in industry. You will be producing year end accounts and CT comps anyway! The only difference is that I will be self employed!

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Replying to raj1234:
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By Cheshire
19th Mar 2019 12:21

It is nothing like being an ACCA member in industry.

I think you need to read that comment from Miss Accounting again, with suitable irony!

You should also very carefully read Reg 8. Or better still actually sling an email to ACCA and await their response. Failure to comply can lead to some severe disclipinary action.

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Replying to raj1234:
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By Accountant A
19th Mar 2019 14:18

Quote:

I agree, how is it any different when being an ACCA member in industry. You will be producing year end accounts and CT comps anyway! The only difference is that I will be self employed!

Not being funny but you really should be able to understand the difference between employment and self-employment. It's of huge significance both for you personally and any clients you may have in the future.

As I said previously, I think your proposed contract sounds like a short-term employment and not self employment.

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By Yalnif
19th Mar 2019 11:12

The first thing you need to establish is whether you are an employee! Are you using their equipment, entitled to holiday / sick pay etc.? If so then PI would be irrelevant as technically you are employed and the pay should be structured as such (i.e. through their payroll).

If not then I would suggest you get PI in place.

Also you mentioned that you would be doing CT, accounts etc. however without a practising certificate from ACCA you would not be able to provide these services (Bookkeeping to TB level only), so I would double check that too before accepting, as could be in breach of practising rules and end up losing you membership.

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Replying to Yalnif:
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By raj1234
19th Mar 2019 12:06

That doesn't make sense though. So if you are an ACCA member in industry and produce year end accounts and CT comps for the business, you are then in breach of practicing rules? I actually spoke to ACCA in the past regarding CT, and they said you can do everything up to CT comps...

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Replying to raj1234:
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By Yalnif
19th Mar 2019 13:14

If you are an employee of a firm within industry, and prepare accounts and tax, it is not you who is responsible for this but the company itself.

Once you are self employed and offer the service of preparing accounts / CT then you become responsible as providing practising services to the public, i.e. the client you speak of, and require a practising certificate to do so.

Check out this link, which defines what public practice is, and clearly states when a practising certificate is required:

https://www.accaglobal.com/content/dam/ACCA_Global/Members/Doc/Am_I_in_P...

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Replying to raj1234:
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By andy.partridge
19th Mar 2019 14:40

Clueless.

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By floggy
19th Mar 2019 12:06

Talk with professional standards at ACCA
they will advise you

If you need a practicing cert you will need to have PI cover

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Lone Wolf
By Lone_Wolf
19th Mar 2019 14:54

If you're struggling this badly to understand the difference between being employed or self employed then I'd suggest you don't need professional indemnity insurance.

What you do need is a new career path.

And they're going to let you supervise the juniors!

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Replying to Lone_Wolf:
Hallerud at Easter
By DJKL
19th Mar 2019 15:16

Harsh but fair, man or woman he don't care, time for Lone Wolf being harsh but fair.'

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Replying to Lone_Wolf:
By penelope pitstop
20th Mar 2019 15:04

That was a bit harsh!

It's tough being a self-employed employee like me, y'know!

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