How much handover information?

How much handover information?

Didn't find your answer?

My posting is to find out from other accountants how much handover info they think is reasonable to provide to the new accountant. Would you ask for or provide more than one year's tax return and accounts? I have also been asked for handover info a full year after I lost (sacked) the client, and in a "priority" email. The new accountant was presumably in a rush to complete the return before the deadline! I would appreciate hearing of other accountants' attitudes/experiences.
Sam

Replies (15)

Please login or register to join the discussion.

avatar
By User deleted
22nd Feb 2008 13:55

As much as to be helpful & relevant
I would provide as much background information as possible relevant to the dealings with client. But I am tempted to provide only the latest set of final accounts together with the tax return.

Hope this is useful

Thanks (0)
avatar
By User deleted
21st Feb 2008 14:10

Planning ahead
Keith Deane's point illustrates how important it is to specify a reasonable charge for this kind of thing in the engagement letter at the outset, when there is unlikely to be any dispute. Failing that, the next best thing is to set out a proper charge-out rate in the disengagement letter. There is no reason why accountants should lose out when a client moves on! What happens when we change dentists? THEY don't pass our charts etc across to the new dentist; so WE have to pay the new person to start from scratch!

Thanks (0)
avatar
By AnonymousUser
21st Feb 2008 14:02

Greg, I'm puzzled by your observations re ACCA
Rules 45-47 (quoted separately in this thread) taken together seem fairly clear. Continuing to rule 48 we find:
"Any information in addition to the reasonable transfer information, as defined in para 47 above, is provided purely at the discretion of the former accountants, who may render a charge to the person requesting the information."
What basis would ACCA have for expecting anything more than their own rulebook requires?

Thanks (0)
avatar
By parsonsmg
21st Feb 2008 11:40

Not so sure on that one
I certainly don't want to get into a protracted thread debating this point, but from experience, what may be written in the rulebook and what the ACCA expect to be sent may differ significantly.

The ACCA (and I agree with) expect that the incoming accountant should be given everything necessary in order for him/her to discharge their duties that they have been appointed for.

We all know that the incoming accountant expects, in addition to accounts and TB you have already mentioned, the most recent CT600 and Comp (or Tax return and comp), together with any details of elections, base costs of assets, etc.

To withhold such information may be an illegal lien, and maybe contrary to general standing orders on codes, bye laws, not to mention sec 3.13 of the "Rulebook" and the all-encompassing "Fundamental principles".

We should be "straightforward and honest in all professional and business relationships" and "not allow bias, conflicts of interest or undue influence of others to override professional and business judgements".

Although commercially the decision to handover all the information is hard (you are in fact holding the only items that form the dispute and essentially ransoming them as the new accountant cannot work without them or re-performing your own work) we must be seen to turn the other cheek and take a moral high ground.

I understand that this stance is preferable in terms of the overall professionalism of the members and their appearance, but it is disappointing that the ACCA do not take any participative role in any fee dispute. I think the above would be easier to swallow if they helped out afterwards.

On reflection of my own predicament, I think I agree that a professional approach is to give them (the new accountants) everything, and maybe hope that (irrespective of professional body) when the roles are reversed; we'll get everything the next time.

The time cost and legals regarding the ACCA matter have already exceeded the unpaid fees. This is maybe another lesson learnt and one I suggest that others should note instead of experience. Better to just let them (the clients) go and be had with, moving swiftly on to the new client that’s waiting in reception for you!

Thanks (0)
avatar
By keithdeane
20th Feb 2008 18:49

As always, the devil is in the detail...
In Rule 47 the ACCA define “reasonable transfer information” as the last formally approved accounts plus a detailed trial balance in agreement with those accounts. That is ALL that is required by Rule 45 to be transferred to the new accountant “promptly” and “free of charge”. Under Rule 48 any further information is supplied at the discretion of the former accountant who may levy a charge for it…(Sorry RR!!)…
I’m a lawyer, not an accountant, but experience has taught me always to check what the legislation (or its equivalent in this case) actually says…

Thanks (0)
avatar
By User deleted
19th Feb 2008 20:17

Very interesting Greg
the accountant I mentioned further down this thread who charged £30 is an FCCA.

Thanks (0)
avatar
By User deleted
19th Feb 2008 11:34

Too true Greg
Greg you are SO right - as I've learnt recently.

Another classic case of ACCA really supporting its members!

Thanks (0)
avatar
By parsonsmg
18th Feb 2008 19:04

Be very careful
The client pretty much has you over here.

ACA - no probs, charge what you like, hold onto the handover info if you have outstanding fees, hold the books to ransom. You guys seem to be able to do anything.

ACCA - under no circumstnace mess about. Hand over everything you can think of straight away. Even things you thought were yours (Fixed asset lead schedules, Sage backups, copy bank statement!) as they probably belong to the client, and to hold onto such is an illegal lien. To my cost, I have found that any such delay, lien, or provarication will result in action from ACCA, when the ex-client knows what their rights are and make any form of complaint. Even with a fee dispute and outstanding fees, the ACCA have drawn my attention to the rulebook and disciplinary action has followed for failure to transfer the info in good time. The client still hasn't paid the fees and the new accountants now have all the information they require (my only bargaining chip). At least the interests of the client are maintained, if not my sales ledger or legal costs!

Rulebook extract:-
"45. In order to ensure continuity of treatment of a client's affairs, former accountants should promptly provide the new accountants with all reasonable transfer information that they request, free of charge.
46. All reasonable transfer information must be provided even where there are unpaid fees. "

Any other professional body - not sure.

Unqualified - You guys have it made! Do what you like!

Hope that helps

Thanks (0)
avatar
By User deleted
15th Feb 2008 20:40

Charging
Sam if your a qualified accountant read up on your rule book - you shouldnt be charging for 'reasonable handover information'

Personally I have never found it that time consuming to provide normal handover info and like to maintain a good relationship with my rivals - it does help at times, as I've found out.

Thanks (0)
avatar
By geoffwolf
15th Feb 2008 14:04

handover
You should know that the tax file belongs to the client and should therefore in theory be handed over in its entirety. It is something I generally ask for.

Thanks (0)
avatar
By User deleted
15th Feb 2008 14:31

No problem if you charge!
I see many engagement letters which say that the accountant will charge his normal hourly rate for handover work on disengagement. What is wrong with that? It means that the handover will be smoother, since the previous accountant will not be rushing the work, but providing a good set of papers for the new accountant, and not trying to minimise the work.

Thanks (0)
avatar
By User deleted
15th Feb 2008 16:32

Six years
I used to work in the Corporate Tax department of a big four firm. We used to provide, and ask for, the last six years accounts, computations and returns and then add a note asking the previous accountant to provide any other documentation that would be helpful - evidence of elections etc.

I think this was just to cover any 6 year claims and elections that might have been missed previously

Thanks (0)
avatar
By User deleted
15th Feb 2008 16:34

I think the ACCA guidelines are
A minimum of a clearence letter and a TB, supplied free of charge.

I would charge a nominal amount for the rest dependant on whether I liked them or not, £100 Ltd, £50 ST.

Thanks (0)
avatar
By User deleted
15th Feb 2008 11:56

I find
that I'm able to pick up quite a lot of info from the tax return (for s/t), but sometimes you just need more. Have never asked for more than one year. Usually, a full set of accounts, tax return, and tax comp/cap all comp should be sufficient, but invariably could do with breakdown of debtors/creditors, bank rec, schedule of fixed assets, loan schedules, etc.. - otherwise, you end up making more and more assumptions.

Eg you can reconcile a loan account if you know op & cl bal (from BS), int paid (from P&L) and the monthly repayments. BUT then you think, why can't the previous accountant just photocopy their schedule?

I also find a woeful lack of some of the nicities, such as (for companies) dispensations (and strangely no P11D's).

I took over a s/t recently, the prev accountant gave me accounts (no FA note), a tax return, and a breakdown of creditors. No idea whether the VAT creditor had any other nasties (will only find out when I do my year), there was no CA comp (the claim 'could' indicate the op bal and therefore I could work out the cl bal, but things like FA additions and waivers can screw that up). And then, he had the cheek to charge my client £30 to supply it! I've heard of this practice, but after taking over approx. 40 clients in the last couple of years, it's the first time I've come across it.

Thanks (0)
avatar
By skylarking
15th Feb 2008 11:45

Do as you would be done by
Clients come and they go. It's all part and parcel of having a practice. I am usually very happy to offer up whatever the incoming accountant wants, just as I expect an outgoing accountant to supply what I want. That may mean 2 years' worth of information to get a better appreciation of the history.

Just because a request comes in after a year it wouldn't be treated any differently than if it came in after a month. Why bother creating conflict.

I think you draw the line if, after you have supplied what was requested, you get drip-fed more requests where you are being treated as the easy option instead of the client being asked. So, apart from the standard accounts, tax returns and calculations in support, the client should supply what the client reasonably can and I supply what the client reasonably can't.

Thanks (0)