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Bank Audit Letter - Bank refusal to supply

Sign up to confirmation.com to get bank audit letter

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Has anyone else experienced a bank (in my case HSBC) refuse to supply a Bank Audit Letter requested manually to be supplied unless we signed up and requested it through the confirmation.com service?

I object to having to do this when it appears to be a pay per confirmation service when the bank used to just charge the client a fee.

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By Accountant A
26th Feb 2020 00:37

International banks are enormous and rely very heavily on automation. That only works if there is a standard form of input. The idea that an accountant can pen a letter in their own format, post it in and expect some poor clerk to read, understand and fulfill the request is a fantasy in the 21st century.

JAllen68 wrote:

I object to having to do this when it appears to be a pay per confirmation service when the bank used to just charge the client a fee.

Someone somewhere pays. That's just business.

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Replying to Accountant A:
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By graydjames
26th Feb 2020 10:19

Wow! I might agree with the last sentence; but the notion that, in the 21st Century, a "poor clerk" cannot read, understand and reply to a standard bank letter is deeply depressing, sad and, hopefully, in fact, entirely untrue.

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RLI
By lionofludesch
26th Feb 2020 06:23

I haven't done an audit for years. But bank letters were always rubbish. The questions were far too complex for the average clerk and you were lucky to get the same balance on the bank letter as on the statement.

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By Duggimon
26th Feb 2020 09:41

To be fair to HSBC, the letters they generate are at least accurate in my experience.

Just pay the fee and charge to the client as a disbursement, you'll do yourself a mischief trying to fight them, you can't talk to anyone there who's able to change or even influence policy.

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By JoF
26th Feb 2020 09:55

If your client is large enough for an audit, then they are large enough for a dedicated relationship manager - have you spoken to that person?

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By johnt27
26th Feb 2020 10:36

Many of the larger banks are now stipulating these kind of conditions. The FRC guidance on bank letters has slowly moved to reflect the times having gone from paper letters only to email. If you do bank letters for Barclays they have an awful PDF that they prefer to receive.

As for bank clerks etc (I've watched Mary Poppins and Harry Potter films) but all this ends up in India to be processed by cheap labour...

As others have said take the cost and bill it onto the client as they won't have been charged by the bank for the letter anymore. Alternatively take a look at Circit.io they're cheaper and their app is way slicker, plus HSBC will reply to their requests (I had one through last week)

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By Mr_awol
26th Feb 2020 11:01

NatWest are also wanting requests this way. The problem is that the secretary (who would ordinarily prepare the postal bank requests on instruction) got stuck signing up for their system, which means it will now fall to someone higher up the ladder to do it.

To be honest bank letters are something of an outdated audit test these days. When each company had one bank, who provided all current, savings, and loan accounts, a bank letter made sense. Now, they are pretty much pointless because:
1) You have to give quite a lot of info for the bank to 'confirm'.
2) The banks have been missing accounts and facilities off the bank letters for so long, they don't give me much, if any, reassurance that the reply is complete.
3) Just because my bank letter from (say) Lloyds says nothing about a £2m loan or credit facility, or the £300k hidden in an undisclosed current account, doesn't mean the directors haven't been down to see HSBC. If they aren't hiding anything they will give you the info. If they are hiding anything, they probably wouldn't be stupid enough to use their main bankers.

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Replying to Mr_awol:
RLI
By lionofludesch
26th Feb 2020 11:26

Spot on.

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Replying to lionofludesch:
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By johnt27
26th Feb 2020 11:55

In this era of OpenBanking you'd think that auditors would be given the power to search for accounts at any bank in a clients name and then request details. That would then return the value to the bank letter process, which at the moment only really confirms what you already know.

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Replying to Mr_awol:
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By paulwakefield1
26th Feb 2020 12:44

Mr_awol wrote:

If they are hiding anything, they probably wouldn't be stupid enough to use their main bankers.

You would think. But not in practice in my experience. "You weren't meant to know about that" said the rapidly ex-client.

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By dejaneiro2005
26th Feb 2020 11:18

Did bank letters re Patisserie Valerie show the £10m of borrowings the board knew nothing about? I think not.

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