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Director did not agree submitted accounts

What is the impact on the Director of accounts submitted without their approval?

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Hi, a potential new client, the company Director, is concerned that his last submitted accounts were submitted without his final approval. It transpires that the accountant had omitted some expenses, and the loss made by the company was greater than the loss advised to HMRC. The sum amounts to a few hundred pounds. The accountant has missed several agreed dates for re-submission of the accounts, and it seems that the accountant / client relationship has broken down irrevocably. What is the impact of the Director telling HMRC about the omission now - 3-4 months after the original submission? Re-working the accounts for that year is likely to prove difficult (for someone else - e.g. me!) without access to the detailed workings. Is it satisfactory to include these expenses in the following year instead? Many thanks. (I'm keeping this anonymous for now, hope that's ok)

 

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By johngroganjga
30th Aug 2019 17:41

What was the other side of the incorrect entry?

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By Susan AW
30th Aug 2019 19:08

That is a very good question! Thank you...Not having seen all the detail, I would have to guess, it would be an overstatement of the profit, because these were costs / expenses that were not included. The company made a loss, so I believe a slightly bigger loss. Does that make sense?

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Replying to Susan AW:
By johngroganjga
01st Sep 2019 08:27

If you don’t know what the nature of the error is, I would take with a pinch of salt what the company owner is saying. Perhaps he just means that some “expenses” are included in debtors as prepayments.

As others have said, it is probably not worth the effort anyway.

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By Wanderer
30th Aug 2019 17:53

For a few hundred pounds of missed expenses I'd probably just include them in the following year.

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By paulhammett
30th Aug 2019 19:19

I agree with Wanderer. Move on, life's too short.

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By Matrix
30th Aug 2019 19:34

A loss of a few hundred pounds x 19% = less than £50

Are you sure you want this client? Why were the accounts submitted without their approval?

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By Susan AW
30th Aug 2019 21:11

Hi, thank you. The jury is out on whether or not I want the client. Re the accounts, as far as I understand the accountant left everything to the day of the deadline for submission. The client was not available that day (he did warn the accountant), and so the accountant submitted without agreement. Six of one, half-a-dozen of the other I guess. However I am aware that the accountant in question has personal probs, and has been somewhat flaky over the past few months. ...c'est la vie. This is borne out by the ongoing failure to meet promised dates (three so far) for the re-work of the accounts submitted.
Thank you for your comment, I'm very appreciative of all who have responded so far.

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By Susan AW
30th Aug 2019 21:15

*duplicated in error*

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By Susan AW
30th Aug 2019 21:12

..oh, and btw, the client has paid up front for the preparation of the accounts under discussion !!

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By LostinSuspense
02nd Sep 2019 12:34

If it is a case of the previous accountant having issues before hand, it might be worth casting a review over the year in question in case other issues come to light?

I would be more worried if there was no obvious explanation as to why the accounts were left until the last minute before filing. It might also be a complete misunderstanding or breakdown in communications.

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By Sandnickel
31st Aug 2019 07:41

Although not strictly correct, by filing the accounts the accountant has saved the client a fine.

Is that not worth the few hundred pounds of losses that your client missed out on (& can put through this years accounts)?

I agree with the other posters in letting sleeping dogs lie.

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RLI
By lionofludesch
31st Aug 2019 10:03

All this fuss over £50 tax - which isn't even payable ? And may never be ?

Seriously, I'd rather let the £50 go than resubmit the accounts and draw attention to the fact that they were wrong. Maybe that's a point you should make to the client.

I'd also think very carefully whether this client is one I'd want to take on. As he's paid you, give him a go but he sounds like a PITA. On the other hand, it's still the season of Wembley goodwill, and I take the point that the client doesn't seem to have been well served by his accountant.

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RLI
By lionofludesch
31st Aug 2019 10:20

Bang goes your anonymity, by the way.

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By Susan AW
31st Aug 2019 11:09

Thank you all for your sage advice. I think I have enough guidance now.
Yes, shame about the anonymity...silly me for replying to the replies. D'uh!

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Replying to Susan AW:
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By lionofludesch
31st Aug 2019 14:44

To remain anonymous, you must include all the information. As soon as you reply to a request for something you missed out, you're gone.

Anonymity is a bit of a myth, really.

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