What is the Fidgity Stand in Accounting?
Fidgity stand-off occurs when a firm's client demands an independent review of the accounting firm's conduct with respect to a particular transaction. It can also happen when the client is dissatisfied with the results of internal controls and lacks legal advice on how to take legal action against the company. An independent accountant is someone who has obtained the necessary professional training and who is highly qualified and has the experience to make analysis of accounting transactions as required by law. He has sufficient experience in order to evaluate the need for further internal controls and has a sound understanding of fiduciary issues. An accountant cannot give legal advice; he cannot give an opinion as to whether a transaction should be conducted or not, and cannot assist a client in preparing a will, executing a trust, or making other legal decisions.
When a client requires accounting advice that is in the form of an opinion, a qualified and properly trained accountant familiar with principles of torts, corporate law, accounting theory, and asset protection will be able to provide the relevant information. There is no requirement that an accountancy firm to provide this kind of advice. However, even if the firm chooses to provide this advice, it must comply with the applicable laws, including the regulations that govern the practice of accountancy. A client may sue his accounting firm if it fails to comply with these laws, including those that apply to fiduciary duties. Therefore, it is vital that any advice given to a client is undertaken in accordance with the law.
There are two possible outcomes here. One is for the client to discover a mistake made by the accountant and then bring a legal action against the firm. Alternatively, the client may discover that the firm acted in bad faith or incompetently when it did not make the error. In either case, the client may end up paying a large amount of money to settle the matter. If the accountant does not make an error that causes harm to the client, the result may be a financial loss, even if the client ultimately loses ground in court.
The importance of the Fidgity Stand in accounting is not lost on the legal profession. The majority of accountants feel that it is important that the client knows the standing of the accountant before entrusting the financial matters to him or her. Therefore, an accountant who explains the fiduciary duty will have a strong legal argument ahead of him or her. The same is true of any other professional who offers similar advice. For example, a physician might offer a general rule to a patient, such as "for every ailment, there is a remedy." In other words, it would be foolish for a physician to advise a heart condition to a patient without first explaining the nature of the ailment and why a remedy is the best available option for the patient. Learn more about this product.
Even though many accountants are loath to make this point clear, the Fidgity Stand remains an important part of modern-day accounting. This is because a company's entire business future is at stake! If a corporation does not retain a professional accountant with a strong Fidgity Stand, it could find itself unable to survive the challenges posed by the rapidly changing world of accounting. A client's decision to switch his or her accounting firm could result in thousands of dollars in losses to the client. Therefore, even if a firm does not have a Fidgity Stand, it is important for its clients to understand that their professional accountant is required to have one.
If a client finds that his or her chosen accountant refuses to carry out the duties required of him or her under the law, the client should take action in order to regain control of his or her affairs. Every client has the right to question a decision made by his or her lawyer. If the accountant refuses to comply with these legal demands, the client may have to resort to various methods of recovery in order to hold the firm legally accountable. Take a look at this company.
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