Lawyers are protected when acting for criminals. They also enjoy client privilege (clients can talk frankly and openly without risk of prosecution). Accountants enjoy neither legal protection nor client privilege.
There are other, free, public services that might help him do his own tax returns which OP could direct the client towards.
Sorry, misread. I agree - much worse. Source of funds and source of wealth...? I wouldn't waste time even looking further into it - enough red flags to walk away and sleep easy.
I disagree. The professional bodies do a pretty poor job of monitoring CPD.
We are regularly asked by prospective clients for our CPD records and plans for the next year, as well as other quality metrics on our firm. Granted more on corporate clients, but it's not a stupid thing to ask.
If I was a client I'd be asking. So many old school accountants out there who don't have a clue about current standards.
Expect to pay between 0.8 to 1.2 times recurring fees if doing upfront and depending on client base. If they are dumping the clients I would expect lower end.
Last time we did it it was a retiring sole practitioner. We paid 25% of the fees for four years. This means we were able to pay out of cashflow and it reduced risk.
Some blend might be appropriate. Always try to defer some consideration so you have some power if things go wrong (e.g. to not pay for duff clients).
Longer answer: Does your client risk assessment allow you to take on known money launderers, and if so how are you addressing this risk? Presumably with very regular monitoring (daily automated screening to external data sources, reviews of his personal finances including personal bank statements, very frank discussions with him, possibly getting an independent security expert or private investigator to prepare a bespoke report, etc)?
If you aren't doing a client risk assessment, what is the point in doing CDD at all? Would you accept anything regardless of the risk? Where is your red line?
Compliance for these kinds of client will cost more than the work itself. Will the client pay for this?
Rapid profit from a property flip is a very common form of money laundering. Who did he sell the property to? Who did he buy it from? Are any of them in any way related to him? How on EARTH did he get a mortgage?! (was it a private mortgage?)
Solicitors are no guarantee that there isn't money laundering involved. They are no better than accountants at spotting it, and judging by your own query on this you should think hard about whether you should do this work - maybe they thought they should accept because he has an accountant(!).
A "good" chartered accountant who genuinely keeps their CPD up to date will *probably* produce more technically correct and compliant accounts when things get tricky. That is not to say there aren't excellent AAT accountants but the qualification is far less technical. AAT themselves say you should consider doing ICAEW after you finish (granted this is sponsored): https://www.aatcomment.org.uk/career/why-you-should-seriously-consider-m...
There are also "bad" chartered accountants who fluff their CPD with "reading technical papers" for an hour a week (which is a lie) and attending a 2 day conference once a year where they play with their iPhone for the whole time and who probably haven't even read the current accounting standards. These are generally the more dangerous accountants who give poor and very often outdated advice but think they know what they're doing.
Qualifications and professional bodies are one piece of a much bigger puzzle. Get references and testimonials before choosing. Ask to view your accountant's CPD record and for details of their practice's compliance framework.
Unlikely to be a major issue with your professional body if it's a minor error, but I would notify insurers of the complaint.
I would normally then offer the client some small discount provided they settle within a week.
If they don't pay then sue the client for the full debt (tell insurers this is what you intend to do).
Don't sue them yourself, pay a debt recovery agent to do it and don't worry about it.
Did your enquiry letter response to the new accountant detail these issues (poor records, unpaid fees), in which case why have they accepted the client...? Or did they not send you an enquiry letter, in which case you have an obligation to ask them why they haven't written to you, and you should speak to your institute to see if you have an obligation to report them.
My answers
Lawyers are protected when acting for criminals. They also enjoy client privilege (clients can talk frankly and openly without risk of prosecution). Accountants enjoy neither legal protection nor client privilege.
There are other, free, public services that might help him do his own tax returns which OP could direct the client towards.
Sorry, misread. I agree - much worse. Source of funds and source of wealth...? I wouldn't waste time even looking further into it - enough red flags to walk away and sleep easy.
I disagree. The professional bodies do a pretty poor job of monitoring CPD.
We are regularly asked by prospective clients for our CPD records and plans for the next year, as well as other quality metrics on our firm. Granted more on corporate clients, but it's not a stupid thing to ask.
If I was a client I'd be asking. So many old school accountants out there who don't have a clue about current standards.
Good point!
Yes.
Expect to pay between 0.8 to 1.2 times recurring fees if doing upfront and depending on client base. If they are dumping the clients I would expect lower end.
Last time we did it it was a retiring sole practitioner. We paid 25% of the fees for four years. This means we were able to pay out of cashflow and it reduced risk.
Some blend might be appropriate. Always try to defer some consideration so you have some power if things go wrong (e.g. to not pay for duff clients).
Short answer: Our firm wouldn't touch this.
Longer answer: Does your client risk assessment allow you to take on known money launderers, and if so how are you addressing this risk? Presumably with very regular monitoring (daily automated screening to external data sources, reviews of his personal finances including personal bank statements, very frank discussions with him, possibly getting an independent security expert or private investigator to prepare a bespoke report, etc)?
If you aren't doing a client risk assessment, what is the point in doing CDD at all? Would you accept anything regardless of the risk? Where is your red line?
Compliance for these kinds of client will cost more than the work itself. Will the client pay for this?
Rapid profit from a property flip is a very common form of money laundering. Who did he sell the property to? Who did he buy it from? Are any of them in any way related to him? How on EARTH did he get a mortgage?! (was it a private mortgage?)
Solicitors are no guarantee that there isn't money laundering involved. They are no better than accountants at spotting it, and judging by your own query on this you should think hard about whether you should do this work - maybe they thought they should accept because he has an accountant(!).
It depends.
A "good" chartered accountant who genuinely keeps their CPD up to date will *probably* produce more technically correct and compliant accounts when things get tricky. That is not to say there aren't excellent AAT accountants but the qualification is far less technical. AAT themselves say you should consider doing ICAEW after you finish (granted this is sponsored): https://www.aatcomment.org.uk/career/why-you-should-seriously-consider-m...
There are also "bad" chartered accountants who fluff their CPD with "reading technical papers" for an hour a week (which is a lie) and attending a 2 day conference once a year where they play with their iPhone for the whole time and who probably haven't even read the current accounting standards. These are generally the more dangerous accountants who give poor and very often outdated advice but think they know what they're doing.
Qualifications and professional bodies are one piece of a much bigger puzzle. Get references and testimonials before choosing. Ask to view your accountant's CPD record and for details of their practice's compliance framework.
Bear in mind if you resign your membership and decide you want to work again and need to be readmitted, it is a b*****he to get it back.
Get a BAS appointment with a local accountant (they are free for this exact kind of thing).
Scheme details here: https://www.icaew.com/about-icaew/find-a-chartered-accountant/icaew-busi...
Full list of providers here: https://find.icaew.com/
Unlikely to be a major issue with your professional body if it's a minor error, but I would notify insurers of the complaint.
I would normally then offer the client some small discount provided they settle within a week.
If they don't pay then sue the client for the full debt (tell insurers this is what you intend to do).
Don't sue them yourself, pay a debt recovery agent to do it and don't worry about it.
Did your enquiry letter response to the new accountant detail these issues (poor records, unpaid fees), in which case why have they accepted the client...? Or did they not send you an enquiry letter, in which case you have an obligation to ask them why they haven't written to you, and you should speak to your institute to see if you have an obligation to report them.