Is accountant at fault here?

[tony84]

Mums accounts were due at the end of November.
She sent everything over to her accountant on I think the 22nd November.
She checked in a few days later to confirm he had everything - which he acknowledged.

The accounts are still not done and so my mum will incur a fine with HMRC for late filing.

The accountant has come back and basically said she will get a fine... No apology or anything.

She used the same person last year and he filed her accounts in under 2 hours, so whilst 8 days might not seem a lot, based on past experience it was plenty of time.


I cant help but think he should be the one footing the bill.

 

[Ziggy2024]

Whilst the communication from the accountant could be better (& potentially could have extended the deadline) it is your mum's fault. You are given 9 months from the end of the financial year to file the accounts, why did she wait until a week prior?

 

[tony84]

Whilst the communication from the accountant could be better (& potentially could have extended the deadline) it is your mum's fault. You are given 9 months from the end of the financial year to file the accounts, why did she wait until a week prior?

She had pneumonia in May and was in and out of hospital hospital for a few months. She is fine and will live but she is still not quite back to 100%. But I dont see how that alters who is at fault.

Ultimately he had 8 days (last year he did it in 1 hour). He confirmed he had everything prior to the deadline.

Should he not have come back and said he cant do it in time? At least then she could have tried to find someone who could have done it in time.

 

[Ziggy2024]

She had pneumonia in May and was in and out of hospital hospital for a few months. She is fine and will live but she is still not quite back to 100%. But I dont see how that alters who is at fault.

I sympathise and I hope she is recovering well. Unfortunately the responsibility for filing the accounts still lies with her & therefore the fine remains with the company.

Ultimately he had 8 days (last year he did it in 1 hour). He confirmed he had everything prior to the deadline.

Should he not have come back and said he cant do it in time? At least then she could have tried to find someone who could have done it in time.

Yes, the accountant should have informed her that he was unable to file the accounts on time. In his position, depending on the relationship with the client and the circumstances I would discount the fee or pay the fine but he is under no obligation to do either.

You (your mum) can appeal the fine with Companies House although they can be quite strict.

 

[tony84]

Dont worry not after sympathy, I never mentioned it as I dont think it has an relevance. Hes either at fault or isnt.

I find it bizarre that he can just sit on accounts and let people fines with no consequences.

 

[Ziggy2024]

Dont worry not after sympathy, I never mentioned it as I dont think it has an relevance. Hes either at fault or isnt.

The accountant is not at fault for the company incurring the fine. He has failed to communicate adequately in terms of being unable to fulfil the agreement. Your mum potentially has recourse in that respect.

 

[tony84]

This is all sounding very cryptic. Im not asking you to jump on a fellow accountant.
I just think my mum could have avoided a fine if he had said 8 days is not enough - and there would have been no hard feelings had he said that.

He did not do that, he acknowledged he had everything when chased 2 days later and still even then with 6 days to go did not say anything. And even if he had said something then, there would still have been no hard feelings.

Its the saying nothing and knowingly going past the deadline and knowing what will happen. I think that is quite a scummy thing to do.

 

[Ziggy2024]

This is all sounding very cryptic. Im not asking you to jump on a fellow accountant.
I just think my mum could have avoided a fine if he had said 8 days is not enough - and there would have been no hard feelings had he said that.

He did not do that, he acknowledged he had everything when chased 2 days later and still even then with 6 days to go did not say anything. And even if he had said something then, there would still have been no hard feelings.

Its the saying nothing and knowingly going past the deadline and knowing what will happen. I think that is quite a scummy thing to do.

Not cryptic at all.

The responsibility for filing company accounts lies with the director. This is the response to the question that you asked. The fine has been incurred because the director has failed in their duty to file on time.

The accountant has not communicated with your mum, that is wrong and I have not (& can't defend) that action. I would check if the accountant made any caveats in their agreement to file on time given the tight deadline. From there you can make a complaint about the accountants behaviour, but this may not get you the fine paid.

I'm not sure what else I can say here, you seem to want the answer to be that the accountant is liable for the fine but that is not the case.

 

[pentel]

Sending the info to my accountant with only 8 days to the deadline I would expect to be filing late.

Just because he happened to have nothing else on and could drop on this straight away last year does not mean that they can do the same this year.

We don't know what the conversation was last year, he may have warned that she was cutting it a bit fine and that he may not be able to offer the same service the next time.

Imagine if everyone sent information to their accountants with only 8 days to deadline

 

[tony84]

Sending the info to my accountant with only 8 days to the deadline I would expect to be filing late.

Just because he happened to have nothing else on and could drop on this straight away last year does not mean that they can do the same this year.

We don't know what the conversation was last year, he may have warned that she was cutting it a bit fine and that he may not be able to offer the same service the next time.

Imagine if everyone sent information to their accountants with only 8 days to deadline

Thats fine and I get that.

But why acknowledge it and then not say it cant be done in time?
Is there no responsibility for the accountant to help prevent fines? All he had to say was "I cant do it in 8 days" and that would have been fine. It would have prevented the fine as we would have found someone else.

 

[Daybooks]

I would trust that the real reason for being miffed is not that the accountant took up to eight or maybe ten days to complete your filings but rather that you may receive a late filing fee.

Whether the accountant previously completed the return in whether the one or the twice as long two hours is perhaps unwise if not dubious.

The reason why it may have taken longer may have been because it was being prioritised on a first come first served basis and there were lots of clients wanting their returns similarly filed within the same or less timescale than yourselves. I know how unprofessional of them! It could also have been that they too had some emergencies – but then why should that be your problem?

Do you have anything in writing that updates a letter of engagement that makes it clear that it is the accountant’s responsibility to file these short notice returns on time?

You may of course take the option of finding a new accountant. It would be good to advise the outgoing accountant as to the reasons for changing. Most incoming accountants will out of courtesy contact the outgoing accountant for professional clearance. In case the outgoing accountant doesn’t pass on any information please be sure to advise the incoming accountant of the reasons and your expectations. I hope that works out well.

I wonder whether some correspondence from Companies House may yet to have come through.

In the meantime if there is a genuine reason for late filing you have the option of appealing any of their penalties to HMRC.

No the accountant is not at fault.

 

[tony84]

Are you all saying then that in this example where documents were sent with 8 days and acknowledged with 6 days to go that none of you would inform your clients you might not be able to get it done in time? (Assuming there is a possibility you might not be able to get it done in time).

 

[DWS]

Are you all saying then that in this example where documents were sent with 8 days and acknowledged with 6 days to go that none of you would inform your clients you might not be able to get it done in time? (Assuming there is a possibility you might not be able to get it done in time).

As an Accountant I agree 8 days is not enough time and you should be given longer, however if I took the work on knowing the deadlines and for any reason I could not meet that deadline I would make sure the client was informed of this, if the reasons the deadline could not be met was due to either awaiting information or payment from the client I again would make sure the client was aware of the late filing penalties and the reasons why I could not submit.
All of this could have been avoided if the Accountant had shortened the accounting period giving them more time to submit the accounts.
In short if the penalties had been incurred due to my fault I would pay these on behalf of the client as a sign of goodwill.
Communication is the key here between both parties.

 

[Lisa Thomas]

Are you absolutely certain the accountant hadn't told the company they would not be able to file the accounts on time unless all necessary info was provided by a certain deadline?

 

[Ziggy2024]

Are you all saying then that in this example where documents were sent with 8 days and acknowledged with 6 days to go that none of you would inform your clients you might not be able to get it done in time? (Assuming there is a possibility you might not be able to get it done in time).

Nobody is saying that. Every answer has been the same. The fine is the fault of the director but the accountant should have communicated that they were unable to complete the job in time.

This is what I said in my replies to you and this has been repeated by the other posters.

You are rightly annoyed that your mum has received a fine but it is not the accountants fault that the company was fined.

 

[Daybooks]

Are you all saying then that in this example where documents were sent with 8 days and acknowledged with 6 days to go that none of you would inform your clients you might not be able to get it done in time? (Assuming there is a possibility you might not be able to get it done in time).

That is not being said I believe by anyone. We don’t know what the accountant may have said or not said. The intention was undoubtedly to file on time if circumstances allowed.

You are making it the accountant’s fault for a perceived lack of communication. The option you had was to specifically say something along the lines of “Look I know we are very late in getting this information to you. Is there anyway you can complete on time to avoid us having to pay a late filing fee, please?” But you didn’t. “No apology or anything” – did I hear you say?

If in reality the response was an emphatic no – we are to believe you would have engaged with another accountant, passed their anti-money laundering and due diligence checks and other on-boarding procedures all in plenty of time to have filed on time.

Appealing any penalty might now be a better use of time. Anything from Companies House yet?

 

[Newchodge]

Thats fine and I get that.

But why acknowledge it and then not say it cant be done in time?
Is there no responsibility for the accountant to help prevent fines? All he had to say was "I cant do it in 8 days" and that would have been fine. It would have prevented the fine as we would have found someone else.

The accountant may have seen the info had been received, so could acknowledge that, but not seen what work was needed. While I agree they should have communicated the delay, the primary responsibility is not theirs.

 

[Chris Ashdown]

So a accountant is expected to stop everything to undertake according to you one hours work and sod his other customers,,
I would be highly pissed off if someone thought i would stop everything for someone who could not bring the work in a reasonable timeframe, the arrogance of your mother expecting this to be done is becoming natural these days
I doubt any other accountant would have stopped everything to undertake the work anyway

 

[DWS]

So a accountant is expected to stop everything to undertake according to you one hours work and sod his other customers,,
I would be highly pissed off if someone thought i would stop everything for someone who could not bring the work in a reasonable timeframe, the arrogance of your mother expecting this to be done is becoming natural these days
I doubt any other accountant would have stopped everything to undertake the work anyway

Well then they should not have taken on the work or they should have informed the client that they are happy to do the accounts but are unable to meet the deadline.

 

[tony84]

So a accountant is expected to stop everything to undertake according to you one hours work and sod his other customers,,
I would be highly pissed off if someone thought i would stop everything for someone who could not bring the work in a reasonable timeframe, the arrogance of your mother expecting this to be done is becoming natural these days
I doubt any other accountant would have stopped everything to undertake the work anyway

Nope.
Never said that. I was advising of the hour turn around time because this is what they did previously (it was never requested, that is just what they did).

The only thing expected would have been for the accountant to say, "Sorry you have sat on this too long, I cant get it done before the deadline" or to do them before the deadline. I dont think that is a lot to ask personally.

 

[tony84]

Are you absolutely certain the accountant hadn't told the company they would not be able to file the accounts on time unless all necessary info was provided by a certain deadline?

100%. All communication has been done by email.

If in reality the response was an emphatic no – we are to believe you would have engaged with another accountant, passed their anti-money laundering and due diligence checks and other on-boarding procedures all in plenty of time to have filed on time.

Appealing any penalty might now be a better use of time. Anything from Companies House yet?

100% could have been done. I know quite a few accountants who I could have called in favours with. But also my mum had another accountant for a previous business (he was not very well when my mum set up the new business, but he is also a friend). So yes it could have been avoided.

Obviously we will be switching to him anyway now - although that was never the plan.

 

[tony84]

Some interesting replies.

Happy to draw a line in it.

 

[Lisa Thomas]

I think your Mum needs to raise her annoyance with the accountants. I'd like to know how they respond. I imagine they have set out their deadline somewhere and it's been missed. Or perhaps they are purposefully not bending over backwards to file accounts at such short notice as a method to prompt your Mum to disengage and instruct another firm.

 

[MyAccountantOnline]

Mums accounts were due at the end of November.
She sent everything over to her accountant on I think the 22nd November.
She checked in a few days later to confirm he had everything - which he acknowledged.

The accounts are still not done and so my mum will incur a fine with HMRC for late filing.

The accountant has come back and basically said she will get a fine... No apology or anything.

She used the same person last year and he filed her accounts in under 2 hours, so whilst 8 days might not seem a lot, based on past experience it was plenty of time.


I cant help but think he should be the one footing the bill.

Your Mum should have a letter of engagement which sets out the timescales and most will state accountants aren’t responsible for penalties if information is supplied late. I’d be very surprised if sending the records needed with 5 working days remaining (assuming the accountant works Monday to Friday) falls within those time limits. If I’m wrong the accountant is at fault.

Regardless of the letter of engagement I do think good practice would have been for the accountant to set a clear cut-off date and to communicate it which doesn’t seem to have happened.

My view as an accountant - 5 working days is being unreasonable. I’d truly be very surprised if the accountant can prepare the accounts and tax return and do all that’s required properly in an hour – if I could do that, I’d be a very rich and probably long since retired accountant by now.

On this one I’d pay the fine and learn the lesson. I think you are being unreasonable suggesting the accountant is at fault.

 

[Mister B]

In addition to the replies above, did your Mother not chase the accountant at all?

I would like to think that if I was only giving the accountant eight days to submit the accounts I would be asking for updates as and when the days were passing.

Communication is a two way street.

 

[tony84]

In addition to the replies above, did your Mother not chase the accountant at all?

I would like to think that if I was only giving the accountant eight days to submit the accounts I would be asking for updates as and when the days were passing.

Communication is a two way street.

Chased him 2 days after sending, he confirmed he received it.

 

[Mister B]

Chased him 2 days after sending, he confirmed he received it.

In that case, although responsibility lies with your Mother, it wouldn't have done the accountant any harm to flag the timescale as being an issue.

 

[Newchodge]

In that case, although responsibility lies with your Mother, it wouldn't have done the accountant any harm to flag the timescale as being an issue.

Looking at the dates, 22 November was Saturday. 2 days later was Monday. Acknowledging receipt without looking at email content would not be unusual. Unless the email clearly flagged the deadline was within 5 working days, it is possible the accountant did not look at the content before the deadline.

 

[DWS]

Looking at the dates, 22 November was Saturday. 2 days later was Monday. Acknowledging receipt without looking at email content would not be unusual. Unless the email clearly flagged the deadline was within 5 working days, it is possible the accountant did not look at the content before the deadline.

I would have thought any decent Accountant would be aware of the deadlines and to have replied to the email accordingly.
I would also have expected them to have previously sent out reminders to their clients giving advance notice of the forthcoming filling deadlines.

 

[Newchodge]

I would have thought any decent Accountant would be aware of the deadlines and to have replied to the email accordingly.
I would also have expected them to have previously sent out reminders to their clients giving advance notice of the forthcoming filling deadlines.

If this was an ongoing client, then yes. If they were a one-off client last year?

 

[Daybooks]

100% could have been done. I know quite a few accountants who I could have called in favours with. But also my mum had another accountant for a previous business (he was not very well when my mum set up the new business, but he is also a friend). So yes it could have been avoided.

Obviously we will be switching to him anyway now - although that was never the plan.

But 100% wasn't done and thus not tested on this occasion. I suspect everyone has got the result they wanted. .

 

[DWS]

If this was an ongoing client, then yes. If they were a one-off client last year?

If they were a client last year and then came back this year then I would class that as ongoing, wouldn’t you?
I would have still sent out reminders unless they informed me they no longer required my services

 

[Lucan Unlordly]

Has your mother actually contacted the Accountant to express her disappointment on the basis that she thought it reasonable to assume he'd have ample time based on the service provided last year?
He may agree to pay or contribute towards the fine given the above and for not advising his inability to meet the deadline.

 

[tony84]

But 100% wasn't done and thus not tested on this occasion. I suspect everyone has got the result they wanted. .

I refer people to my own accountant, I could have asked him to pick it up, I have a qualified accountant who works for me (albeit he is a mortgage broker), she has a relationship with the previous accountant. There is absolutely zero chance I could not have found someone to do it.

Has your mother actually contacted the Accountant to express her disappointment on the basis that she thought it reasonable to assume he'd have ample time based on the service provided last year?
He may agree to pay or contribute towards the fine given the above and for not advising his inability to meet the deadline.

Yes. He came back and said there will be a fine that gets applied. Thats it.

 

[Lisa Thomas]

I refer people to my own accountant, I could have asked him to pick it up, I have a qualified accountant who works for me (albeit he is a mortgage broker), she has a relationship with the previous accountant. There is absolutely zero chance I could not have found someone to do it.


Yes. He came back and said there will be a fine that gets applied. Thats it.

Sounds to me like he's decided to get rid of your Mum as a client, possibly based on the stress from last year (and maybe previous years) of last minute submissions.

Some accountants have mass campaigns to get rid of what they call 'PITA clients' (their term, not mine. Doing the bare minimum and upping their prices etc, so that they are left with clients that give them less hassle.

 

[tony84]

I cant imagine that is the case, last year she was organised hence why he did her accounts in an hour. She downloaded the bank statements (in csv format) and labelled everything that was not obvious with what it was - eg Amazon - would have been labelled with laptop.

Her business is small and no cash involved so every transaction is on a bank statement and its not like there are loads of transactions - maybe 10-15 a month in and out combined.

But yes, she can be a PITA (a term I use a lot... not for clients obviously ... maybe some of them). But not with the accountant. She has spent all year singing his praises to me trying to get me to use him. So it is quite an interesting turn.

Other than sending the paperwork over with 8 days to go, she has not been mithering him or anything as she has spent the last 5 months in and out of hospital concentrating on her health.

 

[numbersrule]

I agree with Pentel's take on this one.

If I sent information 8 days before the deadline I would expect a late filing penalty.

Complaining about any inaction by the Accountant seems totally inappropriate.

I know there may be minutiae to consider about the timings and dates but any complaint could hardly be upheld due to obvious unreasonableness.

Was there a Letter of Engagement in place? The answer to that may say a lot about the status of the working relationship.

 

[tony84]

As I have said, the fine could have been avoided if he had just said "no chance it will be done in time".

I dont think it is unreasonable to expect that but clearly I am in the minority.

 

[Chris Ashdown]

At the end it comes down to the exact wording and spoken word at the time, what and who stated what when handed in, I guess we will never know

 

[DontAsk]

As I have said, the fine could have been avoided if he had just said "no chance it will be done in time".

How? By the time he said that (on the Monday maybe) do you really think you would find another accountant to complete the task in even less time?