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Advice re client engaging with another accountant

Thoughts please

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Client company does own bookeeping in Cloud based system, business grew signifcantly last year end and has done consistently, We picked up numerous errors at the year end and corrected these, but didnt find 2 errors worth £9k. 

 I have now noticed that they have added another accountancy firm as a User in the cloud system. 

I don't want to leave them on bad terms, and want to help, however, feel really uncomfortable doing any further work when clearly their intention is to leave us. I indicated to one of the directors during a call about something else, that I had noticed this, and he said they were taking specialist tax advise from them re shares and business value.

What is the best way to proceed?

 

**UPDATE** other firm have been removed as User and we have received an email asking us to provide ongoing bookkeeping services with immediate effect

Replies (12)

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By thevaliant
14th Oct 2019 12:54

It isn't impossible for a firm to use two accountants. We have several clients we act for as Accountants, but not tax advisers. Or Auditors, but not Accountants.

It can work perfectly well.

But if it makes you feel uncomfortable, then get rid.

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Replying to thevaliant:
Hallerud at Easter
By DJKL
14th Oct 2019 13:23

Agreed. We use various accountants/ tax consultants as we see fit- usually when I want to supplement my knowledge or get reassurance re my latest cunning plan- we also use vast numbers of solicitors, in the last year have used five (edit, originally typed four, forgot one) different law firms but there are another couple we may give business- often it is horses for courses.

Business is not like marriage, monogamy is optional.

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Bramble
By Chris.Mann
14th Oct 2019 13:32

"but didnt find 2 errors worth £9k".

Which begs the question, who did find the errors? Presumably another third party?

I would have expected that professional etiquette would have directed the "other" firm to have contacted you, to outline their (specific) instructions? Or, is this how the profession behaves, in the modern age?

I agree with one of the respondents that, there is no reason why a business can't have more than one accountant, or financial specialist. Of course, the lack of professional communication, brings about the atmosphere of doubt.

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Replying to Chris.Mann:
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By murphy1
14th Oct 2019 16:31

The new employee on board has been doing a 100% review of all postings

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Replying to murphy1:
Bramble
By Chris.Mann
14th Oct 2019 14:16

Is it safe to assume that he/she found the £9k of errors, which by your own admission, you failed to find?

If that is the case then quelle surprise that the FC is checking everything?

I still maintain that it should be reasonable to expect that, the newly appointed alternative adviser should contact the present accountant, to avoid any question of doubt, as regards their instructions, or intentions.

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Replying to Chris.Mann:
Hallerud at Easter
By DJKL
14th Oct 2019 14:41

Agree re the absence of courtesy.

I also am not surprised with the checking- at the end of the day the new FC lives or dies on the accuracy of the accounts- so wanting to start with everything posted in its proper place is logical.

Another reason for his/her checking is understanding why errors arose which may guide controls that may be implemented to reduce future risk.

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Replying to Chris.Mann:
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By murphy1
14th Oct 2019 15:08

Chris,

In a ledger with the amounts of transactions that exist, it would be near impossible to find every misposting that has occurred. Further, we have been advising that they should have a suitably qualified bookkeeper working for them for 2 years now.

The mistatement that existed prior to our work was significant

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By kestrepo
14th Oct 2019 13:51

If you are not happy acting for your client let them know and see what happens (or increase your bill until happiness arises!!). If your client decides to leave let them go, be kind and try to split amicably - try to hold back something to encourage them to pay their final bill but without a complete breakdown in trust! You never know they might come back keen and eager for your services a little way down the line.

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By B Roberts
14th Oct 2019 15:49

When you say "errors" what do you mean? - are we talking about a fundamental error that has affected prior year P&L, or just a nominal code mis-posting (eg. £9k of costs should have gone to widgets and not wodgets?).

I agree with the other comments that the it sounds as though the new FC is trying to show that they are doing a good job (and if they can find any "errors" then they will be happy to report this to the directors).

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Replying to B Roberts:
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By murphy1
14th Oct 2019 16:32

It is one of the directors who posts all the transactions, and so makes loads of mistakes. One was a £3k rent deposit, but he had posted it with narrative of 'Advance rentals.

He is taking responsibility for it all at the moment, saying we could not be expected to find everything, particularly given the volume of errors spotted and the impact on items like profitability, VAT liabilities, PAYE liabilities etc.

Problem is the FC as he seems to think we should have found everything. He used to work as part of a 30 strong accounts team for a company that were Audited.

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Replying to murphy1:
By Moonbeam
14th Oct 2019 17:46

Tell the FC that your remit wasn't audit work, and if the company had requested this level of detailed checks your fees would have been double at least. The directors are responsible for providing you with good quality data to begin with. They failed to do that so the fault lies with them.
Given FC's attitude, I imagine they will be moving elsewhere, so prepare yourself mentally so you can shrug it off when you finally get tole.

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Replying to Moonbeam:
By mrme89
14th Oct 2019 19:07

An auditor may still not have picked up on the errors - they don't check everything, they just sample.

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