ShirleyM
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Am I the only one?

Am I the only one?

When we acquire a new client, part of our routine is to get the client to sign an authorisation letter for the handover of records from the previous accountant.

When we lose/sack a client, we always send them a disengagement letter which advises them to appoint a new accountant as quickly as possible, and that we will need written authorisation before we can hand over any confidential information in order to comply with the Data Protection Act.

We hardly ever receive authorisation. They hardly ever appoint a new accountant until the last minute. We seem to get the blame for the delay anyway!

With the last one, because of the 31 Jan deadline, we even offered the new accountant the option of declaring that they would accept responsibility in the event that the client later refutes giving authorisation for the handover, but they wouldn't. They (accountants & client) still blame us for the delay, though!

I'm getting round to my question .... this procedure is causing delays in the handover. Where we don't get authorisation from the client, could we just put something in our response to the new accountant along the lines of .....

'We have not received authorisation for the handover of the records, therefore, we assume you have received permission from the client for handover of confidential records, and you should confidentially destroy the records without examining them unless you accept responsibility under the Data Protection Act".

Would this get us off the hook?

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20th Jan 2012 09:44

It's all about systems

and how they fit in with your particular body and the smooth running of your business. These days it is very difficult to get the balance right.

When we take over a new client we draft a letter which client signs at meeting, this together with handover letter goes to outgoing Accountant. If we are near 31st Jan and have no chance of getting tax return correct we will put in estimate and our reasons for so doing. If we recieve letter from new accountant without authorisation from ex client I will phone new accountant.

Sometimes you can get "lost" in admin when there is no need.

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20th Jan 2012 15:23

I want something in writing

I respond to 'new' accountant without delay saying we are unable to comply with their request until we have written authority from our client to do so. Seems to do the trick. I have had 'speculative' requests from firms before so tend not to assume I am losing the client.

Shirley, I would be worried about absolving myself of legal, regulatory or moral responsibility through a disclaimer. In the example you have stated, your client doesn't get the opportunity to agree or disagree with it. The following might be better, but I wouldn't be comfortable with it:

To client: 'We have not received authorisation from you for the handover of your records, but, we assume you have given permission to X & C to receive your confidential records, unless you contact us to the contrary within 7 days from the date of this letter.'

Hmm, still doesn't look good to me!

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20th Jan 2012 16:22

Thanks John & Andy

At that stage, we have already written to the (ex)client to inform them we need written authorisation for the handover, but we rarely receive it.

My argument is that I shouldn't have to chase the (ex)client for the authorisation. In reality, the new accountant just blames us for not handing over the records, they conveniently omit to mention that we need written authorisation, and the (ex)clients conveniently forget that they haven't fulfilled their obligations by giving us written authorisation.

I suppose there is nothing I can do, and will just have to put up with their new accountants blaming me for the delay. I just wondered if I am going OTT by insisting on written authorisation, because nobody else seems to bother in our area.

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20th Jan 2012 17:03

*

Isn't best practice these days to issue a disengagement letter?

When I get a handover letter re a client I didn't know I was losing, I just tack on the request for authorisation to respond into the disengagement letter I have to send anyway. If the new accountant is desperate for his stuff, s/he'll usually end up doing the chasing with their new client / my old one for me.

That doesn't stop the old accountant getting the blame for delay, but it does mean we are covered.

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20th Jan 2012 18:15

@adam

I agree. This was mentioned in the opening post, and is a standard part of our disengagement letter.

I suppose I am worrying over nothing. If the submission is late we have plenty of documentation to show we were not the cause of the delay.

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20th Jan 2012 18:40

No assumption

I would do everything by email if possible. Then if the client doesn't give permission I would respond by email to the new accountant saying I couldn't give any information - other than saying they can act, etc. - until the client gives permission. I would copy the client in. In the rare case I had to use the post I would send letters to both with copies.

I would not assume permission had been granted.

 

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22nd Jan 2012 10:32

With the advent

of Agent fast track this will either manifest itself as a problem or the problem will disappear. Depending on the wording of the engagement letter and whether the client signs it or not could make a difference, especially if fees are outstanding.

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24th Jan 2012 09:31

Do you really need 'written' authority?

I admire your diligence and procedure based approach. I also assume you don't lose THAT many clients.

The primary reason you want 'authority' is to avoid any prospect of a complaint that you have breached the required level of confidentiality. The only person who could complain about this is the ex-client. They might also complain at what they perceive to be your dilitory approach. It doesn't matter that you're right. The complaint could still be made.

You would also want to be able to make clear to any professional body reviewer of your files that you have followed due process.

In my view you don't need 'written' authority. Just CLEAR authority. This could be in an email, by phone, text or even via social media as long as you know it is your (ex) client who is communicating with you. And of course you should retain a screen shot, recording or note of call on your files.

Mark

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24th Jan 2012 09:01

Good thinking, Mark!

We do lose the occasional client, but generally, we sack 'em and want to get the records handed over as quickly as possible.

I like the idea of just calling them (and recording the call) so we can get everything handed over quickly. This will be much quicker than getting written authority.

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By alattax
24th Jan 2012 09:24

If you are in any doubt why not send the information to the client to pass on as they wish?

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24th Jan 2012 09:56

@alattax

Another good idea, but I don't think it would work in real life.

I could send the departing client all the information, and then when they lose it (or, more likely, can't be bothered to find it for the new accountant) I can charge them extra for producing yet another set of records ... and that will delay things and possibly lose us the goodwill of the new accountant, so we are back to square one ... unless I prat about repeating the process for an ex-client for free!

Sorry to be so cynical .. but these clients are usually sacked because of their lack of cooperation. I want rid of them, but at the least possible cost to us.

Overall, I think Mark's idea will work best for me.

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By alattax
24th Jan 2012 10:06

Agreed, they will be the least likely to deal with it properly, but it avoids the dilemma of being accused of delay or making unauthorized disclosures.   

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