Lyndhurst accountant Ray Davis expelled by the Institute for Chartered Accountants for England and Wales
A LYNDHURST accountant was kicked out of professional groups and ordered to pay them fines for misconduct which cost the taxman hundreds of thousand of pounds.
Ray Davis, of Shrubbs Hill Road, was branded “incompetent” and excluded from the Institute of Chartered Accountants for England and Wales (ICAEW) in April after it found the allegations proven.
The latest measures, which included an order to pay £7,250 costs, followed an investigation that was triggered when Mr Davis was also expelled last year from the Chartered Institute of Taxation (CIT).
It takes the total amount Mr Davis has been ordered to pay in fines and costs over the past two years to almost £40,000.
The ICAEW confirmed to the A&T it excluded Mr Davis from its organisation after assessing his conduct at a hearing this year. It has only recently published the findings.
The report said: “Given the amounts involved, the position of trust that Mr Davis held and the negative impact that conduct of this sort would have on the public confidence on the accountancy profession, the tribunal concluded that it had no option other than to exclude him.”
The report added that the CIT had fined Mr Davis £20,000 and told him to pay £12,836 costs after it also found him guilty of four charges of misconduct.
These centred on a complaint that he had failed to be “either straightforward or honest or to act honestly and in good faith with Her Majesty’s Revenue and Customs (HMRC)”.
The ICAEW report said the charges concerned claims made by firms for the government’s Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS).
These are schemes designed to help smaller, higher-risk trading companies raise finance by offering a range of tax relief to investors who purchase new shares in them.
The report said that Mr Davis submitted tax returns for clients between 20th February 2013 and 10th February 2017 which sought to claim tax relief to which they were not entitled, using both schemes.
Over that period about 150 such investments were declared to HMRC, which had a total value of £4.5m and were paid to 13 different companies, the ICAEW report continued.
He also put HMRC out of pocket in March 2014 by £247,500, it added, in relation to a VAT reclaim that involved two firms Mr Davis acted for as an accountant.
That included the supposed purchase of a nearly £1.24m boat, the cancellation of the transaction, and the liquidation of one of the businesses.
Mr Davis reclaimed VAT on behalf of one as part of the firm’s March 2014 quarterly VAT return. It was made on the basis of an invoice received from the other firm following the supposed purchase of a £1.237m boat.
But the transaction was cancelled during that period, and the first firm was issued with a credit note by the second. It should not have been a VAT reclaim, but the first firm reclaimed the VAT, later going into liquidation before the VAT had been repaid.
Thirdly a LLP issued VAT invoices from 3rd February 2013 to companies including the first firm, and Further actions by Mr Davis caused a limited liability partnership (LLP) firm to understate its VAT liability by £42,468, said the report.
Mr Davis actions were “incompetent and fell well below the standard expected of him,” ICAEW said, adding: “Given the dishonesty element in complaint one it was far and away the most serious of the two complaints.”.
