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GET ME OUT OF HERE!

I have a LTD client of several years who, at the brink of insolvency due to poor management, is slow to provide me with information, and is generally lacking in responsibility to the business, it's customers and staff.

The two shareholder/directors approached me at the beginning of last week to say that they feared the company would run out of cash by the end of next week, so I wrote to advise them to contact an Insolvency Practitioner immediately to discuss their options.  After one director came back from a long weekend break, they finally saw the Practitioner who has told them to try and carry on at this stage.  This is possible as I have found a substantial bill they paid twice and have asked for a refund!

How do I get out of this engagement when I know that they are in a predicament and quite incapable of recording their transactions and filing returns etc, and are probably unable to afford to switch accountants?

They are local and I am worried about the impact on my reputation if I am seen as 'jumping ship', but at the same time I know that things are only going to get worse, and I could easily find myself embroiled in a situation of them arguing about the business with me in the middle!  I am already finding it difficult as both directors pull me aside to 'chat' about their position and future plans, and I have to keep saying that I am unable to give answers that could give rise to conflict.

I would appreciate any (helpful) comments...

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Lay down the law

You are in an impossible situation - but one that would be difficult to get out of without potential damage to your reputation.

I would suggest that you get both directors together, sit them down, point out the situation, make it very clear that you act for the company - NOT them as individuals, and that you are not prepared to become "piggy in the middle".

Then tell them exactly what information you require, when you require it, and tell them that if they are not prepared to help themselves then you cannot continue to act.

 

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Im with C_D

Explain to them that the only way they are going to turn the corner is if they start to buck up their ideas substantially.  I would also stress that should they not get any info etc you request in a timely fashion that you will no longer be able to act for them.

If they are that unreliable then you shouldnt have too many problems for justifying the split.

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Thanks...

Thanks to you both for your answers.  It's common sense really, but I guess I have fallen into the trap of working pretty closely with this client over the years, and they see me more as part of the management team, rather than an external accountant.  Lesson now learnt!  It makes me think that I need to be alot more careful in future when both accepting work and supporting businesses.  Had I not reduced my fee in an effort to help them, I might not be in this situation now!

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