If your business ever goes beyond a one-man operation, as this guy's did, you will find it necessary to trust other people -- partners, employees, vendors, lawyers, and, yes, accountants. Whether that trust is well-placed or mis-placed can be a very fine line. You seem to have the same deep understanding of what went wrong as this guy's wife does from her armchair in the living room. After your as-yet-uncreated business survives for 20 years, provides a living for 40 employees, and becomes a leader in its space, feel free to come back here and educate all of us on the meaning of negligence and common sense.
If he failed to look at the books in 20 years, or even once notice the shoddy numbers, that would be very strong evidence of negligence. Delegating an essential job doesn't take away the responsibility for supervising performance to make sure the job was done right.
You assume too much. Who's to say he didn't instruct the accountant to cook the books? That seems the most likely scenario to my cynical mind. What kind of accountant would make that kind of basic error?
It beggars belief that the guy could run a successful business for 20 years, but could not understand the difference between receivables and booked work. He was probably boosting cashflow to keep the banks happy, then one day they figured it out and shut him down. Otherwise he would have surely been able to get loans for that vital "equipment".
Ah well, happens all the time. I feel sorry for the guy but he should have been more careful.
You probably don't have time to comment on Hacker News threads when there are so many moving parts of your industry-leading decades-old business that you need to go attend to. Unless you're not speaking from a position of comparable experience. But I doubt it. Opinions completely divorced from the actual facts of the case or from any relevant experience would never be proffered on Hacker News. You probably know exactly what you're talking about.
