New accountants ... unpaid fees.

New accountants ... unpaid fees.

Didn't find your answer?

I know this has come up before but I have yet to work out the search facility on AWEB. I don't see why I should share the fruits of my labour when I was never paid by the client who was made personally bankrupt .... can I get in trouble if I refuse though?
Steven Holloway

Replies (14)

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By Essex FCCA
14th Sep 2007 14:16

If you are qualified....
If you are qualified you will need to check your professional body's rules & regulations.

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By frauke
14th Sep 2007 16:10

Just making a bad situation worse
I can't believe you think that way.

If a client was made personally bankrupt - you need to move on and BE GRATEFUL they took their business elsewhere.

All you are doing is making a bad situation worse....

Taking it out on the client is not fair on the client. They have no choice - they are NOT allowed to pay you!

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By neileg
14th Sep 2007 16:38

Think about it
The client can't pay you, but I don't see any reason why you should do any more work for free. It would be legitimate to charge the new advisor for the costs of retrieving the information and sending it on. So if it takes you an hour to pull the files and copy the data, why shouldn't you recover an hour at your normal rates. It won't be enough to offset your losses, but it might help you to avoid having the mickey taken.

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By carnmores
14th Sep 2007 16:42

depends who is asking
if its the official receiver or other trustee in bankrutcy hand over the papers that you have too. no one else is entitled to any and in any event bankrupts start afresh

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By AnonymousUser
14th Sep 2007 16:51

Checked with the institute ..
have supplied pdf of accounts & tax returns but workings belong to me.

These people chose to lease a £43k BMW 5 months before applying for bankruptcy rather than try and settle my modest fees. They had a lovely leather sofa, laminate flooring and a widescreen TV which would have looked great in my living room. Sorry, but I do not feel remotely obliged to help them out any more than I am forced to.

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By User deleted
15th Sep 2007 13:47

One of my personal favourite subjects
Me and the ICAEW have "discussed" this matter on several occasions.

My usual line in this instance is "sod off your not getting anything out of me, until that b*****d has paid me in full with the interest charge for late payment"

The ICAEW hand book however Statement 1.206 Changes in Professional Appointment, says "a member of the ICAEW should co-operate with a successor in relation to providing information and a member is unable to hold a lien over books or documents of a registered company which either by statute or articles of association of the company, have to be available for public inspection. Non payment of fees is not a reason to not provide this information."

Another example of the marvelous support our institute gives to us...

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By Chris Smail
17th Sep 2007 10:56

It's the Law Robert !
I think our Institute is just at this point helpfully summerising the legal position. They do not tell you to hand over anything more then the legal minimum, they tell you what you must do put in a polite way...

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By User deleted
17th Sep 2007 15:02

Sorry don't understand
Robert - I'm sorry I don't understand. The ICAEW are quoted as saying you can't prevent access for a successor to "books or documents of a registered company which either by statute or articles of association of the company, have to be available for public inspection".

I think that's actually very little. You can't hold a lien over payroll records, VAT records and suchlike - but your work, including unapproved final accounts would seem to be able to be covered by a lien. Your working papers and draft accounts aren't available for public inspection. Neither are the client's bookkeeping records for that.

I think the ICAEW's greatest failing in this scenario is the glib standard advice given, which doesn't get to the heart of the matter. You are legally entitled to take a lien on many (but not all) things and as a sole practitioner myself I agree that the Institute could well be a little more forthcoming with legal advice on this which applies to all its members.

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By User deleted
17th Sep 2007 12:11

It may be the law but...
Chris,

It may presently be the law, but should this not be something that is worked on by our representatives?

The point of a professional body should be - in my opinion - to represent the membership, not the clientele which that membership serves, and yet time and again, the ICAEW appear to be a consumer group interested in the rights of the user not of the member.

In small practice, our clients are by nature much greater credit risks that those of the final 4 (and all large firms) yet much attention is given to the auditors desire to limit its liability, but non to the rights of small practice to collect fees due for services rendered.

The client can go shouting and crying to the ICAEW that we were nasty to them, but we can do little in return - if we cannot even hold on to the paperwork we have spent hours preparing for them, what sanction do we have!

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Euan's picture
By Euan MacLennan
17th Sep 2007 16:30

Re-train as a doctor
Steven seems to have got the appropriate answer from the Institute - in line with Rachel's comments - but like Robert, I do wonder why the ICAEW never does anything useful for us such as getting us a 25% increase in our fee income for 15% fewer hours like the BMA did for GP doctors.

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By User deleted
17th Sep 2007 16:55

books and records
Rachel

The last time I got into this with the ICAEW, I was told that for Ltd's, bookkeeping records do form part of the public record and must also be handed over...

You have missed my point however.

I am not trying to say the ICAEW are technically wrong; they know the rules much better than I do and can quote what is and what is not the law.

What I am trying to say, what is it exactly do they do for the small practice and should they not be there to represent us.

To me, the ICAEW are a self perpetuating body whose sole reason for existence seems to be purely for the sake of existing (ie: if it didn’t exist, you wouldn’t create it) Is this not the very opposite of what it is supposed to be there for; it is supposed to be our representative AGAINST the big bad world.

Yes, fine, in so doing it must set standards of behavior and codes of ethics, but they should be in our favor, not in favor of the very people who are most likely to cause us trouble.

If you ever get into bother with the ICAEW you are guilty until you prove yourself innocent. It doesn’t matter how obnoxious or threatening your client was, you have no rights (without very expensive lawyers representing you)

To me this is against natural justice and not the point membership groups.

Okay, I am passionate about this, but the real question I think for the future of our Institute is not how many mergers it can do, or the value of the ACA or any of the other “noise” that is spun out to us, but rather, who exactly do they want to be and how therefore do we fit in (as members) with their plans.

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By AnonymousUser
18th Sep 2007 08:18

It was actually quite simple
The things that I had that belonged to the client should be returned (books, records, signed accounts, filed tax returns) whereas what belonged to me (previous workings and current work in progress) could be retained. I could have given the new advisors my workings (too generous) and I could have told them to go to HMRC for copies of filed documents (too churlish) .... seems an OK middle ground to me.

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By User deleted
18th Sep 2007 09:36

Glad that's sorted then
Robert I do agree with with regards to the ICAEW. They not stand up for the interests of their members (and in particular sole traders who are so weighed down with keeping up to date with new rules/legislation and paperwork that it really is quite a nightmare to practice on your own). Nor do the public find the final outcome very satisfactory either when people (especially bigger firms) are found guilty.

I really think that this all stems from the London base and the effect of the big four on their decisions. There are more small non-London practices and sole practitioners as members, but the voice is not united and therefore not as strong. I can't afford to take time off to get involved in ICAEW representation as a sole practitioner and not many others can - hence we pay our fees and get little in return.

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By Chris Smail
18th Sep 2007 10:53

Its a bit like the House of Commons used to be
In that the big four second people in for free to ‘assist’ the Institute whereas the struggling masses cannot afford to take time off to participate.

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