The Quantification of Damages role


Damages are a monetary award that the law can impose for breach of duty or a tort (Tam, 2017). It is imposed so that the plaintiff would still be in the same position if the original breach had not occurred. My friend, who undertook work experience for a forensic accounting, firm told me of a case he worked on involving an old JB Hi Fi. In this instance, JB Hi Fi had to close down a store because the council had built a bypass that blocked off and hid away the store. His role was to determine the resulting damages.


Forensic accountants quantify this financial loss, work out a business valuation and calculate other damages resulting from an injury, to use in court proceedings. They deliver an expert unbiased business valuation report in court for disputes or civil action law suits (Giliberti, 2014). Calculating the loss of profits is yet another measure of damages vital to the role of financial accountants  (Pfeiffenberger, 2016). This loss is calculated if the business continues to trade eg. the period JB Hi Fi was open whilst the bypass was there, even whilst suffering diminished revenue. It is to clear to me, when hearing about the many civil action law suits in Australia, the complexity and extensive role of forensic accountants.

Damages –  examples of major Australian law suit: http://www.abc.net.au/news/2014-07-15/black-saturday-bushfire-survivors-secure-record-payout/5597062 




and: https://www.pharmacynews.com.au/news/latest-news/sigma-faces-$10m-payout-in-ferrosig-case




 References
Giliberti, A., 2014. VA Associates. [Online]
Available at: http://www.vaassociates.com.au/assets/Uploads/How-does-a-Forensic-Accountant-with-valuation-expertise-differ-from-a-Business-Valuer-v2.pdf
Pfeiffenberger, L. M., 2016. Meyers, Harrison & PIA Valuation and Litigation Support. [Online]
Available at: http://mhpbv.com/publications/lost-profits-versus-lost-business-value/
Tam, J., 2017. Legal Match. [Online]
Available at: http://www.legalmatch.com/law-library/article/types-of-damages-available-for-breach-of-contract.html


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