Difficult issue

Bookkeeper leading client astray

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Long standing client disengaged qualified bookeeper last year and has given the job to a relative who has no experience of any form of bookkeeping, accounts etc. The old bookkeeper rang to say she was leaving and told me who was taking over. She also said she had tried to do a handover and some training but the new bookeeper didn't engage. As result the old bookeeper said she didn't agree with some of the things she had seen and she didn't want anything more to with the clients business. Fast forward to the accounts for that year - the bookeeping was shocking thousands of pounds of personal items put through the business as misc and large sums of income missed off. I corrected everything and spent three hours going through the accounts with the client and bookkeeper face to face got the sign off and sent them. I'm now being continually rung up by the bookeeper claiming the accounts are wrong and the client is paying too much tax. I've patiently addressed each issue even though we've begged to differ on occasions. These are basic lack of understanding of tax and accounting rules for example the bookeeper maintains dividends should be tax free to the tax payer because corporation tax has already been paid. I calculate that they have had 20 hours of my time free of charge in conference calls. They don't want to pay because I charge a flat fee for the accounts and they are arguing that this is part of the accounts. I have prepared a letter to disengage because frankly this is making me ill and taking time away from clients who do appreciate my efforts. I believe trust between us has broken down nothing I say convinces them what I've done is correct and the bookeeper just wants to score points. 

Yesterday I had a call from the bookeeper to say that the accounts were wrong because the directors company car wasn't owned by the company it belonged to him. I've asked to see the registration document, certainly documents I've was shown when it was bought referred to the company and in all the conversations we've had it was always a company car. If it is the directors own car, the submitted accounts will need amending, as will the PAYE and the directors personal tax return. I know that this will create a larger tax liability and create a DL acct and we will be off round the loop again about paying too much tax.

After all that background my question is given the new revelation when would be the best time to disengage. Do I give them a couple of weeks to prove the car belongs to the director and if nothing is forthcoming disengage. If the accounts do need amending should I amend them and send them to the director for approval. I know they won't be agreed if paying more tax is involved so I can disengage then. Finally when it comes to the handover do I send copies of any unapproved amended accounts to the new accountants. I just want to move on and I don't want to get into long drawn out arguments with these two anymore.

Sorry to be so long winded but my user name is my real name so I've had to post anonymously and won't be able to answer questions.

Replies (9)

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By mrme89
28th Jul 2017 10:19

Normally, I'd advise to disengage now. But I feel that in doing so, they will try and make your life hell and potentially make unfounded complaints to your professional body.
So, I'd try resolve all the issues and then send them on their way. Any work that is outside the scope of the engagement should be quoted for. Only undertake work which they have agreed the quote for. Nobody works for free.

Do you have a copy of the vehicle documents on file? If so, send them a copy. If the car was subsequently sold to the director and they haven't told you, they will need to pay for the work to do the corrections.

Managing the bookkeeper is easy. You tell them in no uncertain terms that they are thick as pig [***] and don't know anything about accountancy and tax, and that you will no longer be engaging in communication with them - all the communication should be done through the client.

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By zebaa
28th Jul 2017 10:34

Disengage now. It has got bad and it will get worse. Get out. Deal with any post-disengagement problems if, or when, they arise, but at least you can see an end point to an untenable situation. Good luck.

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Red Leader
By Red Leader
28th Jul 2017 11:30

I agree about disengaging now. I know I would end up losing my temper with these muppets, you may be more tolerant. There is no "better" time just over the horizon.

You are probably making the mistake of reasonable people everywhere that unreasonable people just need to listen to you a bit more and all will be well.

The client may be being led astray but they were the ones who decided to trade down with their b/k and who continue to listen to near-fraudulent tax saving. Hmm.

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By possep
28th Jul 2017 13:45

Personally I would immediately disengage. If you have acted on the information provided to you and subsequent transactions have taken place that you were not aware of why waste more time and money.

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By jantill
28th Jul 2017 16:19

I run a consultancy and in business but not an accountant.
I read with sympathy of your problems and with the adage that "everything is negotiable" I would tell the client (politely but firmly) that your fees were set based on dealing with an experienced bookkeeper. Explain that the extra work in dealing with their accounts are chargeable and that you regret that until you receive payment for the additional work (at whatever rate you consider reasonable) you can do no more work for them.
In this way you give the client the opportunity to put it right with you. If they pay, you can carry on until you decide otherwise. If they don't pay then you can walk away.

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By andy.partridge
28th Jul 2017 16:52

Actually this is not too difficult.

Renegotiate your fee. Explain to your client that the intensive and excessive support you are giving the bookkeeper is above and beyond your engagement agreement. Outcome is that either client pays more or you don't deal with the bookkeeper.

Ask your client to explain to the bookeeper what you have agreed so that the bookkeeper understands that you are not a free resource. Reiterate this with the bookkeeper - ie. you are only too pleased to go into as much detail as they wish but they need to appreciate that there is a cost involved that will be billed.

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By Sheepy306
28th Jul 2017 21:52

Sounds to me like it's not about the money so no point in negotiating fees. You've said that trust has broken down and it's making you ill. It's an unworkable relationship with the book-keeper. Have confidence in the work you've done, sounds like you've been way more than reasonable. Resign swiftly and enjoy your other work and clients.

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By carnmores
01st Aug 2017 11:00

surely you should tell him to sack the bookkeeper and why and if they do not respond then sack the client and send a full bill

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By raybackler
01st Aug 2017 11:18

I had a similar situation. I persevered with a client and eventually it ended up with the relationship breaking down completely. Most accountants are reasonable people, giving professional advice that comes from hard earned experience. Where this advice is disrespected, it can get personal, leading to the way you are feeling. It is always worse when you have had previous good history with the client. However, blood is thicker than water and you are never going to get the support you had previously from your client. This is not about trying too recover the situation. It is about recognising that it will never work, so get out as soon as you can.

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