Professional Negligence

Independent forensic accounting evidence for professional negligence claims

When a professional negligence claim involves financial advice, reporting, tax, accounting or audit issues, independent forensic accounting evidence can help assess what happened and quantify the alleged loss. Professional negligence claims can arise across a broad range of professions, and the financial analysis may need to consider the professional’s scope of work, applicable professional standards and the losses directly attributable to the alleged negligence. NIFA helps solicitors, insurers, claimants and defendants find forensic accountants with the expertise needed to review records, test assumptions and provide clear expert evidence.

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How professional negligence support works

A NIFA member can review the professional work in issue, the financial records, the alleged loss and the assumptions behind the claim or defence. This can include considering the purpose and scope of the work agreed between the parties, including relevant contractual or engagement terms and assessing the extent to which that scope was addressed by the professional.

The expert can explain the financial impact, identify alternative scenarios and present findings in a balanced report. Where appropriate, NIFA members can also consider duty of care and, in claims concerning accountants, auditors or tax advisers, provide expert evidence on liability as well as the quantum of loss. This can include assessing compliance with generally accepted professional practice and applicable laws and regulations.

Who professional negligence expertise is for

Professional negligence support is for solicitors, insurers, businesses, individuals and professionals involved in claims where accounting, audit, tax or financial advice may have caused or contributed to a loss.

NIFA members can act for both claimants and defendants and have experience working as expert witnesses, shadow experts and expert advisers. For claimants, this can include assessing the strengths and weaknesses of a potential claim and preparing loss calculations. For defendants, members can identify areas of the claim that may require challenge or rebuttal.

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When professional negligence expertise can help

NIFA members have experience and can assist with the quantification of losses arising from alleged professional negligence by assisting with:

  • Claims involving accounting, tax, audit or financial reporting advice.
  • Claims involving accountants, auditors and tax advisers, solicitors, medical professionals, architects and surveyors.
  • Review of the professional’s agreed scope of work and relevant contractual or engagement terms.
  • Assessment of professional practice, applicable laws and regulations in claims involving accounting professionals.
  • Assessment of whether a financial loss has been caused by the alleged negligence.
  • Quantification of loss, mitigation and alternative outcomes.
  • Calculation of consequential losses arising from alleged professional negligence.
  • Independent review of complex financial records and assumptions.
  • Review and challenge of financial loss calculations or other expert evidence.

Professional negligence process and outcomes

The process usually begins with a review of the background, the professional work in issue and the financial loss alleged. Depending on the nature of the instruction, this may include reviewing engagement or contractual terms to understand the agreed scope of work and considering the relevant professional standards, laws and regulations.

The forensic accountant then analyses the evidence, considers the counterfactual position and identifies and assesses the factors affecting the alleged loss, before preparing a report explaining the financial consequences. Where accounting, audit or tax professionals are involved, the analysis may also address liability issues within the member’s area of expertise.

The outcome is independent analysis that can support case assessment, settlement discussions or proceedings, including detailed loss calculations and expert reports where required for use in court.

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Why choose a NIFA member for professional negligence matters?

NIFA brings together independent forensic accountants who understand litigation support, expert witness duties and the financial issues that arise in professional negligence claims. Members’ backgrounds in professional practice allow them to bring practical, real-world experience to their expert work. Many also have additional disciplines as registered auditors, insolvency practitioners, tax specialists or general accountancy practitioners.

Members are experienced in undertaking detailed analysis of the factors affecting loss and in preparing robust loss calculations and expert evidence. They work with clients and their legal advisers to ensure that their work is fit for purpose and cost-effective, while maintaining the objectivity and independence required of an expert. Their work is undertaken in accordance with the Civil Procedure Rules and practice directions relevant to expert evidence.

Legal professionals can use NIFA to identify a suitably experienced specialist, while members benefit from shared resources, training, referral opportunities and annual quality review.

To find a forensic accountant with the professional negligence expertise your matter requires…

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FAQs

Without early forensic accounting input, parties may proceed on assumptions about causation, quantum or mitigation that are not supported by the financial evidence. Early analysis can help identify the factors affecting the alleged loss, test the basis of the calculations and highlight aspects of a claim that may require further investigation, challenge or rebuttal.

Yes. NIFA members have experience acting for both claimants and defendants in professional negligence matters and can be instructed as expert witnesses, shadow experts or expert advisers. For claimants, members can help assess a potential claim and prepare loss calculations. For defendants, they can identify financial issues that may require challenge or rebuttal.

In professional negligence cases concerning accountants, auditors or tax advisers, NIFA members may be able to provide expert evidence on liability as well as quantum. This can include considering whether the professional complied with generally accepted practice and applicable laws and regulations.

Contact NIFA with a summary of the advice or conduct in issue, the alleged loss and the records available so a suitable forensic accountant can be identified.