Intrigued by such negligence, I read further and the accountant said 'he was not surprised about the intervention check and that he had warned Mr Hartigan ‘several times’ about VAT.'
So, not as clear cut then. I would have followed that up with a letter recommending registration. The accountant should have been clear and covered his backside, but was he negligent? He advised the client verbally and the client (possibly) chose to ignore him. And the judge chose to side with the taxpayer's version that he had never been told.
We've all had clients like this and the client was lucky that HMRC/judge decided to accept his version (on the advice given about registration). Hence the need to be extra careful.
I distinctly remember filing VAT Returns by hand; delivering them to Southend VAT office at 11.00 pm on the last day and getting a hand written receipt from security. Those were the days.
And I still call them the 'Inland Revenue'. Unfortunately. Should I retire?!
I wouldn't consider this a reasonable excuse, since, as others have stated, the VAT payment is a separate issue to the VAT filing online.
As an ex-auditor, I would have to agree with you but not for the same reasons. Companies have statutory audits because they're obliged to do so and auditors plan their jobs to do the best they can given the level of fee and potential for legal action if they get it materially wrong. So yes, the auditor will have a reasonable expectation of discovering fraud, but I have come across some ingenious frauds in my time, executed by fairly ordinary people which you are not necessarily going to discover in a statutory audit. Discovery would mean testing an enormous number of transactions from many different angles which it's just not possible to do in the time available.
My own view is that companies would see a better return from devising better systems of control in the first place, rather than wasting money on a procedure carried out by a junior who may change the sample to suit and possibly even fix the results, to go home at 5.00 pm. I've had them. And don't even start me on audit partners....
“If the finance team isn’t responsible for this -- who is?”
The cost or budget centre holder of course. This won't be a finance team responsibility in larger businesses, where all invoices are checked and signed off by budget holders. The finance team are largely a processing unit; yes, they will check other aspects of an invoice and prevent some types of fraud, but invoice creep and over-billing is not something they would ordinarily spot.
I'm using the apprenticeship levy (not in practice) to put my latest trainee through AAT. My first AAT trainee moved on to ACCA afterwards and is very nearly qualified. The AAT is a good foundation and not a bad stepping stone if you decide you want to go further.
I recently acquired a 'Gangsta Accountant' T-shirt as a joke, as my staff keep calling me this for some reason (!) but really I don't want anything to do with accountancy (or tax) at this time of the year. I tend to want 'anything but accountancy' gifts and have asked for an electric multi-meter and a 3+ ton jack this year. I'm a frustrated handyman / motor mechanic really who relaxes working with hands when not working with my head.
Training providers are way behind the mark in offering suitable courses that can be attended and consequently there is limited availability, which may account for the drop-off whilst people wait for them to catch up.
It's also far too difficult to tap into and a good proportion of professional firms are resigned to just writing it off.
Let's face it, it's just a tax with another name.