The legal conflict wherein the CPA Australia is involved resulted to the unfortunate loss of the protection provided for the members that are public practitioners. These means that for a period of at least six months starting this October, they will no longer have immunity from malpractice lawsuits that ranges up to multimillions of dollars.The legal shield provided by CPA Australia used to act as the accountant professional liability insurance of the public practicing accountants in the country.
According to the Professional Standards Council which is the regulator agency from the government, it has been confirmed that the professional standards program that has been protecting the body by limiting the liability received by the members of the public practice is not up for renewal despite the fact that it is expiring this 7th of October.
This will affect all public practice members that are located in a number of regions including Western Australia, South Australia, New South Wales and Queensland. This will result to member paying a higher amount for their professional indemnity insurance and they have a chance of being subjected to unlimited liability due to negligence.
It was last month that the legal conflict was revealed to the public but the CPA has been reassuring that the process is still ongoing with PSC and that they are trying to reach a resolution.
CPA remains firm with this despite the confirmation announced by PSC at the end of last month. According to the announcement, CPAs that are practicing under Victorian public will no longer have a legal shield starting October. CPA continues to affirm their members that their applications are still in active status and that they continue to settle with the PSC regarding the active application.
The PSC clarified that the new program was not created before the expiration of the Professional Standards Scheme expires thus they are not sure when the replacement program will be implemented. They have given a time estimated of a minimum of six months before the new program is given an approval. For the meantime, public practicing members would have to be careful as they will be practicing with no accountant professional liability insurance for the time being until such time that a new scheme is put in place.