DUTY OF DUE CARE & PROFESSIONAL COMPETENCE (AATWA)

            A member of the AATWA, by virtue of the AATWA Constitution & Bye Laws, has a duty of professional competence and do care. Obviously this is adapted from that of ICAN which is adapted from that of IFAC. This duty of care & competence will be broken down so that students can appreciate what it entails better.

DUTY OF CARE 

                  At Common Law, a “duty of care” does not arise from a contract. What this means is that there is no need for a contract to exist for there to be a “duty of care”. A ” duty of care” is, in many cases, imposed on  a party merely based on the capacity in which he acts. Many professional persons have this duty imposed on them.

              While the AAT is not a legally recognized professional per se (only members of ICAN & ANAN are recognized as accountants by CAMA 2004),  the ICAN Act of 1965 gave ICAN the right to set standards for which intending accountants must meet and to admit such qualified persons into membership. The AATWA is a professional technican body which, by inference, is comprised of professionals who ICAN has set a standard for and admitted into membership. The law might hold a member to the standards of ICAN itself in some cases. While no case law backs this for now, ICAN does discipline members of AATWA as it would its chartered accountants.

               The Tort of Negligence is the Common Law concept which set the stage for the duty of care. One is said to have a duty of care to another if, by neglecting to take caution and act in a certain way he would be putting that other person in harms way. A road user has a duty of care to every other road user. He must take care in driving by observing all road regulations so as not to harm another road user. A professional lawyer has a duty of care to his client. He must make sure to represent his client in the most diligent manner possible so as to protect his interests before law enforcement & the . An auditor has the duty to exercise the highest standard of competence in conducting his audit so the party he reports to will not suffer loss as a result of material misstatements undetected. An Associate Accounting Technician (AAT), in his capacity as bookkeeper or accountant, must make sure he renders accounts which are true & fair to the standards set by the profession. Not doing so can deceive the party he reports to and that party could suffer loss. 

THE STANDARD OF CARE ADOPTED BY THE LAW IS “REASONABLE CARE/SKILL” 

            This “Reasonable Man Doctrine” is particularly prevalent in the Law of Negligence.  The “reasonable man” is a hypothetical average or common man put in the shoes of the defendant. What would a reasonable man do? This concept is important because the law would want to know when a person could be said to have discharged his duty of care or taken all “reasonable” precautions. In other words, the law wants a standard with which to measure the duty of care. That standard is the reasonable man. 

              Of course the reasonable man varies from case to case. There are many models of the reasonable man. If the law wanted to decide if a doctor acted as a reasonable man would, obviously the reasonable man would be a doctor also. An as the reasonable man is a man or ordinary prudence, the doctor would be expected to act as would an average practitioner of medicine in his shoes would. He would not be expected to do more than is normal. In Cassidi v Minister of Health (1951) 2QB243 it was held that the hospital authority was vicariously liable for a careless operation which worsened the plaintiffs case whether the doctors did the job for a reward or not. Lord Denning stated that “when a man goes to a doctor because he is ill, no one doubts that the doctor must exercise reasonable care and skill in his treatment…

               Thus in deciding whether an AAT member discharged his duty of care, the law would put an average AAT in the shoes of the defendant. What would an ordinary prudent and competent AAT? The GAAP, IFRSs, IPSAS, CAMA, TAX LAWS, AATWA CONSTITUTION & BYE LAWS etc are reference documents for the court to determine the reasonable skills that a reasonable AAT should have exhibited.

               A hypothetical example would be where an AAT commits a material mistatement by consistently recording large sums of expense as asset thereby overstating profits and causing users to suffer loss by investing in a company which subsequently goes bankrupt.The principle that a reasonable AAT should have applied in treating the transaction might be taken from the IFRSs. But then a defense exists in Section 334 Subsection (1) of CAMA 1990 which places the duty to prepare accounts on the directors of the company. It may be unlikely that an accountant in the capacity of financial accountant would be held liable for any breach of duty arising from his negligence. Again there is the issue of vicarious liability with imposes the negligence of the servant on the master. There is no wealth of case law in this matter to decipher the view of the law.  In prticular negligence cases against accountants are usually in the area of auditing which AATs cannot practice.

               But one thing which is clear is that ICAN would discipline erring AATWA members. So an AAT should not undertake work he is not skilled enough to handle. Consider the text below:

Culled from AATWA Constitution & Bye Laws [ICAN]

 COMPLAINTS AGAINST A MEMBER OF THE AAT 

  • 2.1Where  a  complaint  is  received  by  the  Institute  alleging  a  case  of  misconduct against  a  member  of  the  AAT,  such  complaint  shall  be  referred  to  the  Investigating  Panel for necessary action. 
  • 2.2 Where  there  is  a  media  report  alleging  misconduct  on  the  part  of  a  member,  the Panel shall investigate such a case and request for the response of the member. 
  • 2.3 A member  against  whom  a  complaint  has  been  made  other  than  deriving  from  an on  going  investigation  of  a  complaint  with  which  he  or  she  is  concerned  as  a  witness  or complainant  shall  be  requested  by  the  Investigating  Panel  to  present  his/her  defence  or reaction  to  the  complaint  or  allegation  within  twenty-one  (21)  days  of  the  receipt  of  the request to do so. 
  • 2.4 If  the  member  fails  to  respond  within  the  specified  time,  a  first  reminder  shall  be sent  to  him  requesting  him  to  send  his  defence/reaction  within  fourteen  (14)  days  after  the receipt of the reminder
  •  2.5 If  the  member  still  fails  to  respond  again,  a  second  and  final  reminder  shall  be sent  to  him  with  a  fourteen  (14)  day  ultimatum  within  which  to  reply  and  a  warning  that non-response  shall  amount  to  contempt  of  the  Institute  AAT  and  be  referred  to  the Executive Committee for disciplinary action.
  •  2.6 If  no  response  is  received  after  the  3  notices,  a  newspaper  advert  may  be  inserted; advising  him  of  the  nature  of  the  complaint  and  demanding  his  immediate  attention, failing  which  the  AAT  Executive  will  be  resorted  to  for  a  final  determination  of  the members conduct.
  •  2.7 The  period  of  notices  specified  above  may  be  dispensed  with  partly  or  wholly  by the  Panel  where  in  the  course  of  an  investigation,  it  becomes  just  and  appropriate  in  the view of the Panel to do so.
  •  2.8 Where  a  non-member  fails  to  respond  after  two  reminders  have  been  sent  to  him, the Panel shall be entitled to rely on the facts and evidence available. 
  • 2.9 The  Panel  shall  be  at  liberty  to  re-open  any  matter  upon  receipt  of  fresh  evidence or information if in the opinion of the Panel it is just to do so. 
  • 2.10 Where  a  member  is  known  to  be  out  of  the  Country  temporarily  or  permanently, the  Panel  would  make  reasonable  efforts  to  communicate  with  him  at  his/her  overseas address,  or  his/her  last  known  address.    If  a  member  fails/neglects  to  notify  the  AAT  of  a temporary  or  permanent  change  in  his/her  address,  the  Panel  shall  deem  the  address  on the  records  of  the  AAT  as  the  current  address  for  the  purpose  of  service  of correspondence and notices.
  •  2.11 Where  the  Panel  is  unable  to  contact  a  member,  the  Panel  shall  cause  an  advert  to be  published  in  two  national  Newspapers  inviting  the  member  to  call  on  the  registrar  or panel urgently or on a specified date.
  •   2.12 The  Provisions  and/or  procedures  contained  in  paragraphs  2.3  –  2.7  above  shall apply  to  all  other  requirements  or  directives  of  the  Panel  to  a  member  so  that  failure  or neglect  by  the  member  to  abide  by  the  requirement  or  directive  shall  be  treated  as contempt of the AAT, and is sanctionable by the AAT Executive Committee. 

WHO CAN BE A MEMBER OF AATWA?

           Originally ICAN in partnership with ABWA conceived this scheme to be a platform for chartered accountancy aspirants without degrees to attain the ACA qualification after undergoing what it called TECHNICIAN EXAMS. Times have changed though. Now the AAT certification is sought out for many different reasons. The minimum entry qualification for the exams is just the SSCE! So everyone could aspire to become AAT holders. But the question now is… Why would I want to be an AAT if I am a non -accountant? 
I AM IN A RELATED FIELD (LAW, ESTATE VALUATION, QUANTITY SURVEYOR ETC)

         If you are a law student who wants to work as a career tax practitioner, it should not come as a surprise to you that the LL.B will not give you the full knowledge you need. The tax covered at law school focuses on cases & statute, but lacks in depth treatment of computations and returns. The AAT will give you the latter. 

          If you are an estate valuer/ manager, then it should not come as a surprise to you that you are in a stewardship position and so must account to your master. The AAT certification will ground you on the nitty -gritty of accountancy required to maintain both own records and records of clients. 

            A Quantity Surveyor is basically part of the extended accountant family. You are experts of costing and advisory services pertaining to construction contracts. Apart from your BESMM4, you should know your work product must also conform to IFRSs (IAS 11: CONSTRUCTION CONTACTS in particular). AAT will help make the accounting part of your job easier for you to perform.

YOU OWN A BUSINESS 

             Every business owner knows, at least by instinct, that records keeping is essential for performance evaluation of business. But if you want to have both instinct & knowledge. Do AAT program. 

YOU WANT TO BE A CHARTERED ACCOUNTANT BUT YOU DON’T HAVE A DEGREE 

              It will interest you to know that after induction as an AAT member, you are allowed to write just only 9 papers(two stages) in ICAN to qualify as a chartered accountant without a degree!! Holders of degrees are made to sit 16 papers. 

           Any questions can be posted as comments. I will speedily reply! Cheers!

ICAN (AAT) VS ICAN (ACA): THE DIFFERENCES

RIGHT TO BE APPOINTED AS AUDITOR
             An AATWA member cannot be appointed an auditor of a company by virtue of CAMA 2004[Amendment]. The recognized bodies are ICAN & ANAN. AATs can work as audit technicians conducting & performing the audit procedures. But he cannot sign off the audit report.

RIGHT TO SIGN OFF TAX RETURNS & PRACTICE TAX PLANNING WORK

            In Uk, taxation is not a particularly restricted service. A taxpayer is solely liable for misstatements on the returns. AAT holders in UK can and do practice taxation in all is ramifications. But the case is not the same in Nigeria. Taxation is restricted to ICAN, NBA & CITN members by law .  Technically only CITN controls the practice of tax, but a recent MOU provides that holders of ACA and LL.B (Barrister) can get the certification on application without exams. CITN is the Chartered Institute of Taxation of Nigeria and it issues the ACTI certificate. AATs can serve as tax technicians,  doing the computations & drafting the returns but not signing off.

RIGHT TO PRACTICE BANKRUPTCY

          Only lawyers & ACAs , for the most part, can practice Insolvency. AATWA members cannot practice this field. 

RIGHT TO OPEN AN ACCOUNTING PRACTICE

           Again, ABWA & ICAN don’t issue practice license to AAT holders. This means that an AAT cannot establish a firm. At least not legally. So this, in summary, means that an AAT lacks many of the the specs of full fledged accountants. But they are suitable assistants to the qualified ones. 

        Outside the restricted services & power listed above, AAT holders can and do practice other areas of ACCOUNTING in all ramifications. But his work would ideally be supervised by an ACA.

WHAT AATWA CERTIFICATION CAN OFFER YOU

Culled from http://www.ican.org.ng

THE PLACE OF AAT IN THE ACCOUNTING PROFESSION 

           In line with its statutory responsibilities, the Institute conducts examinations for prospective members who, on qualifying as Chartered Accountants, occupy top-level positions in various sectors of the economy. Below this level are the HND and B.Sc (Accounting) graduates who are not professionals. Thus, between the Chartered Accountants and their unsophisticated and diverse clients, there existed a vacuum that needed to be filled. This vacuum could only be filled by Accounting Technicians who are trained to understand and interpret the language of the professionals to the clients.  Similarly, many career civil servants who worked in Finance related positions and did not have the requisite qualifications to enable  them  advance  progressively  on  the job  or  eventually  become  Chartered Accountants  could  not  be  promoted.  Thus, there  was  the  dire  need  to  provide  middle level  accounting  certificate  for  these categories  of  personnel  both  in  the  public and private sectors of the economy. 

                The  Scheme  also  provides  opportunities  for the  graduands  to  attain  the  peak  of  the profession  by  aspiring  and  qualifying  as Chartered  Accountants.  For  this  class  of Nigerians,  the  programme  holds  out  a  dual advantage.  While they have opportunity to progressively advance  on  the  rungs  of  the  ladder  of  their   careers,  the  graduates  of  the  scheme  are   additionally eligible to register as students for the Professional Examinations and thereafter claim exemptions from the Foundation, Intermediate and Business Law in P.E I  levels. 

                To attain the above objectives, the graduates of the scheme need  to  be  adequately  equipped   with intellectual abilities and practical skills that  would  enable  them  function  effectively within  the  economy  and  if  they  wish,  pursue further  academic  and  professional qualifications. 

ADVANTAGES OF AAT 

* Holders  of  the  Association  of Accounting  Technicians  qualification can  use  their  certificate  to  proceed to  the  ICAN  Professional  qualifying examinations scheme and

 eventually  qualify  as  full-fledged Chartered Accountants.   

·  The  AAT  certificate  can  also  be used  to  secure  admission  into  a University to study B.Sc Accounting,  Banking  &  Finance, Economics,  Taxation,  Business Administration, etc. Many Nigerian  Universities  equate AAT  Certificate  with  ND (Accounting)  Upper  Credit  and, so,  admit  holders  into  200  level of a relevant degree programme.  This  is  particularly crucial  because  these  days, importance  is         University attached  to degrees by employers  of  labour  in  the Nigerian and global economy.

 * An  AAT  certificate  holder    can  work in  both  the  private  and  public  sectors of  any  economy  in  the  world.  The certificate  indicates  competence,   integrity  and  ability  to  take  on responsibility  of  an  accounting nature.  The  duties  that  might  be assigned  vary  from  organization  to organization.  They  range  from  more routine  to  technical  works.  In  the commercial  and  industrial  sectors, holders  of  AAT  certificate  should  be able  to  earn  rapid  promotion  to middle level management particularly  with  dedication  and  hard work  

·  Holders  of  the  AAT  certificates  are very  good  Audit  clerks  –  checking records and  conducting  bank reconciliations.    He/She  may  be  an  invoice  clerk checking  invoices  and  arranging payments.   Be  required  to  prepare  data  for computer  system  or  to  prepare accounts and statements of cash flow. Be  required  to  prepare  or  check PAYE,  VAT  and  other  tax returns.   May  also  be  involved  in  more technical  aspects  of  auditing, preparation of financial statements  and  budgeting.   Be  used  as  supervisors  in  some organizations  –  planning  and monitoring  the  work  of  other junior staff. These  are  just  some  of  the opportunities  open  to  holders  of  AAT Certificates.

ICAN VS CITN: WHICH SHOULD I GO FOR?

√ WHAT IS CITN?
           The Chartered Institute of Taxation of Nigeria started on February 4, 1982 as Association of Tax Administrators and Practitioners. Thereafter, it transformed into Nigeria Institute of Taxation, which was formally launched on February 21, 1982 and statutorily recognized on May 6, 1987 as company Limited by Guarantee.

The Institute was chartered by the Federal Government of Nigeria by the enabling Act No. 76 of 1992 (now CITN Act, CAP C10, Vol. 2, Laws of the Federation of Nigeria, 2004) and was charged with the responsibility, among others, of determining what standards of knowledge and skills are to be attained by persons seeking to become professional Tax Practitioners or Administrators. 
√THE CASE OF CITN vs ICAN [suit no.M/476/2005]

               ICAN and CITN faced off on who had the power to regulate tax. In particular ICAN had the power, by its enabling act, to regulate “Accountancy”. But the law did not define all that fell under the term. But taxation is a typical service rendered by ACAs. But that notwithstanding, the court ruled against ICAN in its verdict reached in 2007. 

                Justice Lateefat Okunnu held that “The law makers in their wisdom, have created a new profession out of tax practice. It is not for the court of law to question them for so doing. Nor can the court attempt (by means of its pronouncements) to abrogate this law simply because a particular judge is not enamored of it. As we say in legal circles, sentiments have no place in law. All that the court will do is to interpret laws in such a way as to give them the proper meaning and effect that the law makers intended. This particular law – the CITN Act – I find, has come to create a new order that hitherto did not exist. It has created the taxation profession, and determined and defined the “space”, as it were, within which that profession is to exist and be practised.” Needless to say, CITN won. 
√THE MOU OF 10 MARCH, 2015

             Basically this Memorandum of Understanding signed by CITN & ICAN provides, among other things, that ICAN members will be admitted into membership of CITN with no exams. Just pay and be inducted. The reverse is not the case.
√SO WHICH ROUTE SHOULD I GO IF I WANT TO BE A TAX ACCOUNTANT?

            ICAN if you are not yet sure what branch you want to specialize in. CITN if you are sure you want to be s tax accountant. But I would advise  ICAN whichever be the case because 1) It is more recognized in tax practices than CITN certification. So do well and get both. 2) You may change your mind tomorrow. CITN would have pigeonholed you to taxation.

GETTING YOURSELF READY FOR ICAN/ATSWA EXAM BEFORE THE EXAM

              For those of you writing ATSWA exams for the first time, you are most likely the most susceptible to mistakes. Some can be pardoned. Some cannot. There were candidates in the 2016 Sept exams [I wrote at PH centre] that were penalized for various offenses [some even asked to forgo the diet]. Imagine the stress and financial resources wasted! So pls:-
√VISIT THE TESTING CENTRE FEW DAYS TO THE EXAM

        The testing centres will be on the exam advert that will be available online two months to the exam. Pls. Visit it. Know the proximity. Ask about the fastest route or maybe consider going to find accommodation around there at least for the duration of the exams. Many candidates begged and begged in vain when they arrived and the doors were shut. Guess what? It was their first time locating the venues!!! Please. Don’t be a victim. They won’t show mercy.

√PRINT YOUR DOCKET A DAY TO THE EXAM AND TAKE IT TO THE HALL

                 A “docket” is simply a form bearing your exam number, picture and centre. A day to the exam go to the site and CLICK ON check exam number. Fill in your student number and the form comes out. Print.

√ONCE AT THE TESTING CENTRE DON’T READ ANY TEXT. JUST REVISE NOTES

                   It is tempting to start “jacking” at ICAN exam centre. Why? Because you will see many “serious looking faces” doing that. Don’t follow. U will just be adding tension. 

√ARRIVE AT LEAST 30MINS BEFORE THE EXAM 

                 Because you never know. Maybe you forgot something and may need to buy it around. So come early. Exam time is 9:30am. Come by 9am.

√READ THE INSTRUCTIONS CAREFULLY

                When the paper is shared out, please read the instructions. This may not be necessary in other exams, but it is in ICAN. They do penalize for disobedience. 

√DO YOUR BEST AND STOP WHEN YOU HEAR STOP!

               Remember in school exams when people start writing when they hear stop? Well this is not one of those exams. Trust me. Don’t ever fall a victim to this one. Pls.

IS THE BSC ACCOUNTING BECOMING IRRELEVANT IN NIGERIA?

           There have been many controversies relating to this issue. It is fair to say that most believe that the BSC in Accounting is gradually becoming obsolete and won’t stand the test of time. This is worsened by the fact that university accounting syllabuses are disconnected from professional curricula. I strongly believe that an academic degree in Accounting is unnecessary for the most part. I will give some reasons why and recommend combinations.
√THE AAT CERTIFICATION IS EQUATED TO A BSC BY ICAN

            Truth is, an AAT certification is equated to a BsC in Accounting by ICAN even though universities don’t see it as degree equivalent. A Bsc Accounting graduate is exempted from 5 papers and catapulted to the skills level. This is the identical treatment for AAT holders. But here is where it gets tricky:

1)AATWA can be acquired with just WASSC certification and little else within a period of 1 year and six months or 2 years. The degree is acquired after 4 years with a series of exams like JAMB and post UTME before entry. 

2)Ironically, AATWA certificate holders fair better, are better prepared and are held in higher esteem than their BSC counterparts.
√ANYBODY CAN BE A CHARTERED ACCOUNTANT

              Apart from the fact that people could qualify as ACA via the AAT route, there is still the fact that a graduate in any discipline is still welcomed to ICAN even without prior qualification like AAT.
√BSC ACCOUNTING IS DISCONNECTED FROM THE ICAN PROGRAM

             Many graduates of Accounting will agree that the first time the studied the IFRSs meaningfully was in ICAN. Some will still go all out and say that the degree did not prepare them for depth of ICAN exams. So why study a degree which rarely covers the professional curriculum it relates to?
√AUDIT FIRMS DON’T CARE WHAT YOU STUDIED IN SCHOOL

            Audit firms like KPMG, PWC, Ernst & Young etc don’t care what you studied at school. In fact it has been said by some insiders that these firms appreciate science and math degrees more! Imagine. All these firms care about is a second class (upper) and the ACA certification. Any other issue (e.g the course studied) is left variable.  
√IF YOU GET A BSC IN ACCOUNTING AND DON’T PASS ICAN OR ACCA YOU ARE IN TROUBLE. BIG ONE

               Ultimately most people now do ACA program just as trial. If it works fine. Chartered accountant. If not its OK. But if you got a BSC in Accounting, forgot about that excuse. Your BSC says accounting. If you don’t get chartered the BSC is worth less than the paper used.
~SO WHAT SHOULD I STUDY THEN?

               If you want to be tax accountant, get the LL.B and even go to law school. Then get your ACA. This would increase your skills in taxation considerably and will set you up for  very juicy positions. Again you have plan A & B.

              If you want to be an auditor study Statistics, Economics or Computer Science. Frankly speaking the blunt audit courses taught in the BSC Accounting teach nothing. In real world, audit is all about data analytics & statistical methods. Instinct is the third element and is acquired on the job.
~BUT WHO SHOULD DO THE BSC IN ACCOUNTING THEN?

               Well the only person who should do it is someone who either can’t like any other course or who wants to be a lecturer or something.