Mr. Desai was retained by a law firm to complete the accountant’s portion of the annual Trust Report which the law firm was required to submit to the Law Society of British Columbia (LSBC). Mr. Desai completed the relevant portions of the Trust Report and attested that the law firm was in compliance with all LSBC rules for trust accounting. The LSBC subsequently conducted an audit of the law firm which revealed numerous breaches of LSBC requirements, including failure to maintain books and records, a trust shortage and deficient trust reconciliations.
Mr. Desai:
- Did not have the professional competence or expertise to carry out the engagement with the law firm diligently or with due care
- Falsely attested that the law firm was in compliance with all LSBC rules when he knew the law firm was in breach of numerous rules
- Used the Juricert identification of another person to sign and file the trust report
- Was not independent of the law firm in this engagement, as he prepared some of the bookkeeping upon which he was required to attest.
The Investigation Committee determined Mr. Desai contravened the CPABC Code of Professional Conduct as follows:
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
203 - Professional competence
204.1 - Assurance and specified auditing procedures engagements
205(a) - False or misleading documents
206.1 - Compliance with professional standards
The Committee recommended Mr. Desai:
- accept a reprimand;
- pay a fine of $10,000; and
- pay investigation expenses of $2,759.