On December 13, 2006, the Indiana Court of Appeals reviewed the statute of limitations applicable to claims of accountant malpractice. In so doing, it also considered whether the accountant’s “continuing representation” after the client’s financial harm became known should postpone commencement of the limitations period for a claim against the accountant.
In this case the court upheld summary judgment in favor of the accounting firm, but it held that in some situations an accountant’s representation of the client in attempting to adjust or resolve the harm will postpone commencement of the limitations period.
The facts were that the plaintiff roofing contractor was a longtime client of the defendant accounting firm. The representation included compilation of annual financial statements, preparation of tax returns, and assistance to and training of the client’s in-house accounting manager. In March 2003 the client discovered its accounting manager had been embezzling company funds. In July 2004 the client sued the firm alleging its negligence contributed to the loss. The trial court entered summary judgment for the accounting firm on the grounds the suit was not timely filed.