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Accountancy Newsletter - February 2023

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By Richard Highley


Published 07 February 2023


DAC Beachcroft's Accountancy Newsletter features topical news and insights for our clients and contacts


The FRC Disciplinary Tribunal’s Decision in KPMG – Regenersis/Carillion

Its significance for junior accountants and audit firms

The decision underlines the regulator’s expectation that integrity should flow throughout an audit team at all levels of seniority. Lack of seniority will not be considered an excuse.

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Implications of the Sequana decision for Directors and their advisers

The Supreme Court’s recent judgment inBTI v Sequanais a significant decision for the law of directors’ duties.  Directors must keep the financial position of their company under close review and seek professional advice to support them in making financial assessments regarding the risk of insolvency.

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No reflective loss principle: shareholders will explore other avenues to recover their loss

Burnford v Automobile Association Developments is a helpful reminder to accountants and auditors to check that the language of their disclaimers is sufficiently clear and wide to disclaim liability to third parties.

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Sanctions – A New Era of Compliance for Accountants and Auditors

UK sanctions prohibit the provision of accountancy services to ‘persons connected with Russia’. What do these sanctions mean in practice for accountants and auditors, and what can you do to mitigate the risk of falling foul of them?

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Accountancy experts must be objective and independent at all stages in litigation

Patricia Andrews v Kronospan affirms the court’s position on objectivity and impartiality and highlights the danger if an expert witness strays and allows their evidence to be crafted by those instructing them.

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An accountant’s right to withhold client papers while fees remain unpaid – common sense must prevail when exercising the lien

Mr David Ellis v John Hodge Solicitors (a firm) [2022] EWHC 2284 (Comm)

The accountant’s lien can provide leverage in fee negotiations where a client refuses to pay (arguably without good reason). However, where fees are unpaid because the client considers the accountant was negligent, and there is appetite to pursue a negligence claim, the lien will swiftly lose its bite.

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HMRC loses its appetite for blueberry croissants and vegan cocktails…

HMRC is taking action against professional advisers and companies who HMRC consider are inappropriately pushing the boundaries of R&D claims.  Advisers need to be alive to the risks of submitting erroneous R&D tax claims.

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