Accountant's legal responsibility;

              Accountants' Legal Responsibility
By OSCAR S. GELLEIN Partner, Executive Office
Presented at a Joint Meeting of the Texas Society of Certified Public Accountants and the Southern States Accountants' Conference, Fort Worth, Texas — June 1957
INTRODUCTION
Attainment of professional standing requires acceptance of responsi­bility.
Nominal responsibility is incompatible with professional status. Observance of a code of conduct, high standards of education, self-disci­pline,
public service — all of these are marks of a profession, but the quality that really sets the professional endeavor apart is the presence of significant responsibility and willingness to accept it within a claimed sphere of competence.
In law as a profession the responsibility relates to the protection of the civil, the constitutional, and the statutory rights of the individual or business enterprise. In medicine it relates, of course, to the physical well-being of the individual. In accounting, as we know, it concerns economic well-being.
At the outset, let me say that it is not my intention to offer interpreta­tions
of the cases or of the law bearing upon accountants' legal liability. This is not my field. Here, I borrow mainly from Saul Levy who has written competently about this subject, particularly in his book, Accountants' Legal Responsibility. It is my intention, however, to consider some of the legal hazards facing us in our work and some of the things that we might do as accountants to minimize the risks inherent in our exposure to them.
Before doing this, however, I think it well to consider that the possible incidence of claims against accountants is not confined to the accountants of any particular region or to accounting firms of any particular size. More­over,
important as liability insurance is, it cannot furnish immunity from all of the losses, economic and otherwise, attending the defense of a claim. Loss of time may be considerable. In addition, there may be a great deal of personal strain if the case receives public attention, regardless of its merits or of its outcome.
The number of claims against accountants that have been carried into the courts and to the point in litigation where there is a record that the court acted upon the claim is not outstandingly large. The number of cases where claims were withdrawn or settled short of a judgment by the court is unknown. Continuing improvement of the work of the auditor lessens
86