Comparative Analysis: Professional Responsibilities in Accounting

This report provides a comparative analysis of the professional responsibilities and liabilities of accountants in both small and large firms. It explores key areas such as data protection, fraud, engagement authentication, and mergers, highlighting the differing approaches and levels of concern between the two groups. The report emphasizes the importance of data protection measures, the impact of employee fraud, and the significance of proper documentation and risk management, particularly in the context of mergers and acquisitions. The conclusion underscores the need for accountants to understand and manage their liabilities effectively to contribute to company growth, with references to relevant academic sources to support the analysis. This assignment, available on Desklib, offers valuable insights into the practical application of accounting principles.

Running head: PROFESSIONAL RESPONSIBILITIES
PROFESSIONAL RESPONSIBILITIES
Name of the student:
Name of the university
Author note:

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PROFESSIONAL RESPONSIBILITIES
Executive Summary
The report discusses the various aspects of professional liabilities of the accountants of two
different companies. It compares the impact of the liabilities on them and records their actions in
different situation. Above all, the accountants are responsible for a company’s growth.

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Table of Contents
Introduction:....................................................................................................................................3
Data protection:...........................................................................................................................3
Fraud:...........................................................................................................................................3
Engagement authentication:.........................................................................................................4
Merger:........................................................................................................................................4
Conclusion:......................................................................................................................................4
References:......................................................................................................................................5

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Introduction:
The report aims to identify the professional liabilities of the accountants of a small and a large
firm. It compares the various aspects of liabilities faced by them. The accountants of a small
company have fewer liabilities than the bigger one (Green, 2014). They act differently in
different situations and handle various issues according to the need and norms of the company.
Data protection:
Financial organizations use various methods to protect data in order to maintain the integrity and
safety of the client’s data as well as account information. It is the liability of all kinds of financial
firms. The most popular belief is that the hackers are the greatest threats of the personal data but
in most cases, the corrupt employees are responsible for breaching privacy data. From an
accountant of a large CPA firm, the company is completely aware of this fact and provides the
clients data protection coverage (Yadav, 2014). Whereas, small-to-mid-sized firm accountant
group believe themselves immune and do not expect huge loss when the client’s data are
compromised.
Fraud:
Employee fraud is a very frequent incident in any organization but it leaves a more negative
effect when employee theft takes place in any CPA firm client. In these cases, the auditors are
one to be blamed. To a smaller firm, the accountants are not very concerned about it, as they do
not feel targeted due to their size. Despite the fact that the accountants are not responsible for
detecting fraud but when a company grows, the exposure increases and the liability falls on the
accountants for quality control (Hadi, 2014). The group of accountants working in a larger firm

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has engaged themselves to look after their risk management that continues to grow with the
growth of the company.
Engagement authentication:
The accountants of the larger company produce the engagement documents with proper details
of provided accounting services and client’s signature. This helps to refer the scope of expertise
and limitations of responsibility so that no trouble regarding engagement arises (Koleva &
Gorgieva-Trajkovska, 2016). On the other hand, the small firm accountants believe these
documentations cannot prevent clients from suing the company.
As the CPAs are assisting clients to manage and transfer their wealth, the large firm accountants
involve with the right parties and update the documentation. This is one of the most important
tools to dispose to the defense counsel at the time of claim. Therefore, when the specialists begin
to review they will get idea about the company’s service quality. This accountant group believes
that if they maintain good documentation, they can interpose and eliminate problematic claims.
Merger:
As business slows down, the companies tend to merge. This can be the highest exposure for a
company. The accountants of the larger firm consider and analyze various issues that may affect
the acquiring company later on. Before acquisition, they ask for peer review history or claim
history to mitigate possible exposure.
Conclusion:
Therefore, the comparative attestation analysis proves that the two groups of accountants have
different ideas regarding professional liabilities. In order to increase company’s growth, the
accountants must keep track of the expenses related to the various aspects of the organization.

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References:
Hadi, K. A. A., Paino, H., Ismail, Z., & Dhiyauddin, M. H. (2014). Forgery in the making of
audit report: the liabilities and breach of professional duties. Procedia-Social and Behavioral
Sciences, 145, 110-115.
Koleva, B., & Gorgieva-Trajkovska, O. (2016). Accountancy planning and control-a necessity of
management process. Academic Journal „Management and Education “Burgas, 12(1), 10-15.
Yadav, B. (2014). Creative Accounting: an empirical study from professional
perspective. International journal.
Green, W. L. (2014). History and Survey of Accountancy (RLE Accounting). Routledge.