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. 
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