Handover information from ACCA member

Handover information from ACCA member

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I was approached by a potential client to take on their accounts & tax work which includes monthly management accounts. I wrote the usual professional clearance letter to the previous accountants (an ACCA member) which included a request for a copy of the Sage backup of the books of the business for the current year. Obviously this accountant is a bit pissed off at losing a client as he has refused to give us a Sage back up - instead he has provided us with print outs showing all the transactions and invited us to re-enter them.

Apart from the fact that it must have taken him a lot longer to print out all the information and email it to us than to email a backup, I would have thought that the Sage data (irrespective of the fact that it was created on software purchased by the accountant) was still part of the books of the client that the accountant was paid to prepare, and thus should be provided to the client. Does anyone have a view on this?

I am constantly surprised, I know I shouldn't be, at the pettiness of some "professionals". When I challenged him about this and said that I thought he was being obstructive his answer was:

"I am certainly not being obstructive and have spent several hours collating the information you require at no cost to the client. I might point out that I invested a great deal of money purchasing the client version of Sage just for xxxxxx xxxxxx, only to be in this position within less than 1 year which I will have to write off."

Replies (12)

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By occca
21st Jun 2010 17:46

Part way through year?

Is it part way through the year?

 

 

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By cymraeg_draig
21st Jun 2010 18:14

No - the backup does not form a part of the books.  This may seem petty, but legally he is well within his rights.

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By lisawight
21st Jun 2010 19:38

Engagement terms

Theres a need to consider:

(a) engagement letter and

(b) any other engagement terms

As they may touch on ownership of data.  My firms standard engagement letter for examply explicity says unless we are contracted to prepare records in a specific form, eg sage, the data belongs to us not the client. 

If the engagement letter is no help, ask what the contract is, and whats on fee invoices. 

Put simply was the contracted output a vat return and nominal ledger or was it a set of sage data?

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By James Hellyer
21st Jun 2010 23:12

Company or not?

If the client is a limited company the Sage records are part of the company's books and records as defined by the Companies Act.

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By cymraeg_draig
22nd Jun 2010 09:51

James - It depends

Only if the client has specifically paid the previous accountant to input the data AND, critically, if the client owns the licence to the software used.  The client cannot own data held in a programme which is not itself owned by the client.

If the accountant owns the software then he is licenced to use it to prepare figures for his own use - ie. to enable the preparation of accounts, tax returns etc. 

The client does not own the software and is therefore not licenced to use it or entitled to any data held in it.  

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By James Hellyer
22nd Jun 2010 11:01

I'm not sure I agree...

The ICAEW helpsheet on exercising lien would seem to suggest that virtually anything can form part of a company's accounting records. If you've done the client's bookkeeping on Sage, then that dataset becomes part of the company's accounting records as it is the book of prime entry!

Obviously the client could only access the data if they had a a Sage licence, but I think they and their agent would be entitled to it.

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By cymraeg_draig
22nd Jun 2010 11:07

Unsure but......................

ICAEW helpsheets and law are 2 very different things.  Much as they would like to think they are, the ICAEW are not above the law. 

Licencing is not my specialist field but I suspect that there is no right to a backup. There would be a right to the data in the form of a print-out but I doubt anything more.  

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By elsupremo
22nd Jun 2010 12:02

WHAT A NONSENSE!

If the previous acconntant had kept manual books for the Client rather than Sage records then presumably he would have passed over the full set of books.  He should pass over the data. I think the licensing is a red herring as you are not asking for a copy of the Sage software, just the backup data which you will be able to use on a legally registered copy of Sage. The Client has been charged for the work to be done so I fail to see why he should'nt have the records, provided he has paid the previous agent in full.

Bemused Accountant

 

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By cymraeg_draig
22nd Jun 2010 13:45

Small print

Bemused Accountant

 

Posted by elsupremo on Tue, 22/06/2010 - 12:02

 

You certainly are.  I suggest you carefully read Sage's licening agreement, or you could also become a much poorer accountant.

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By andystyan
22nd Jun 2010 16:28

CD so if it is not possible to send them due to licences

then on this thread https://www.accountingweb.co.uk/anyanswers/computer-records-enquiry I guess your answer would be that we cannot give HMRC a backup on account of licences.

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By cymraeg_draig
22nd Jun 2010 18:15

Surprised

I'm saying that you should be very careful before you do. 

Incidently, anyone forwarding a "backup" to HMRC would be a fool as computer records can be tampered with - always supply a paper print out.  I would be quite surprised if HMRC requested such a backup as, for very obvious reasons,  their internal rules strictly forbid them from putting data from any third party onto their computer system.  Actually any such request should be viewed with suspicion, and cleared with their Chief executives office.

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By Neville Ford
23rd Jun 2010 08:50

Thank you for all your replies, I didn't expect it to kick off such a debate. Whilst there is an interesting question of legality it is more a question of professional courtesy, ethics & morals. I would argue that if you have been paid to do some work, ie: keep the books of a business, then the results of that work morally belongs to the client irrespective of the legal question.

I think the attitude of the previous accountant is summarised in the last paragraph which is a direct quote from one of his emails. In 17 years of practice this is the first time I have met with such an attitude. I always believe in dealing with people - clients & fellow professionals - in a polite & courtious manner, you never know when you will need a favour from them. One of my first bosses, who was alway polite even when giving you a bollocking, said be polite to people on your way up, you never know who you are going to meet on your way down!

If I lose a client to another firm (which thankfully is very rare) I try to send the information as quickly as possible and as fully as possible to get it off my desk and reduce queries (so minimising my losses) and then get on with jobs that earn me money. This guy spent more time (& hence lost more income) by firstly providing the information in such a way that it took him more time to prepare and secondly by arguing with me at length about it afterwards.

But not only has he cost himself money but he has antagonised a client, who has switched for convenience not dissatisfaction, thereby putting himself totally out of the running if I make a mess and also the client would not now recommend him to anyone else, where previously he would.

In reality it hasn't inconvenienced us greatly as all we have to do is input an additional two months transactions,  there aren't a huge amount of transactions in this business, and we can also set the ledgers up to suit ourselves.

 

 

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