Auditor charged extra for going concern work

[DaliaSpring]

We've had an invoice from our auditors for the final part of the annual audit fee. They've added on an extra 1k citing additional costs in relation to the audit of going concern due to Covid.

Notwithstanding that they never discussed or notified us of this previously, have other auditors been doing this?

 

[Paul Kelly ICHYB]

Regardless of whether they did or didn't tell you, what does your contract with them state about additional charges?

 

[DaliaSpring]

No doubt there's something in the contract allowing them to do this, but I'm interested if extra charges for going concern work are a common occurrence. Many of our suppliers and partners have been very helpful (we're in the hospitality sector).

 

[UK Contractor Accountant]

Is this a Companies Act audit due to exceeding the turnover, gross assets, no of employees limits or a voluntary audit?

 

[DaliaSpring]

It's due to the company being a charity exceeding the turnover limit.

 

[Scalloway]

The accountancy bodies are sufficiently worried about businesses being going concerns because of Covid 19 they have issued advice to their members to include it as part of their audit work.

https://www.icaew.com/insights/view...cern-increased-risk-of-material-uncertainties

 

[Rawlinson Pryde]

Going concern would have to be considered in COVID times and not. We have taken a hit with some of our audits, as it has been harder to audit during COVID, although it is better to suffer a “loss” to retain the client for next year.

The best thing to do would be to speak to them. We would generally speak to a client before hitting them with an extra fee to explain and ideally in advance of the work (although not always possible), even if it was in the engagement letter or not.

Perhaps look for an alternative firm for next year if you are not totally happy?

 

[MyAccountantOnline]

We've had an invoice from our auditors for the final part of the annual audit fee. They've added on an extra 1k citing additional costs in relation to the audit of going concern due to Covid.

Notwithstanding that they never discussed or notified us of this previously, have other auditors been doing this?

It's not unreasonable to charge for additional work required, but regardless of the reason in my opinion no accountants should ever add additional fees which aren't discussed with and agreed with the client first.

 

[KAC]

I agree with the other accountants/auditors on here. Basis of charging should be agreed in advance and certainly the charity should have had prior notice that an additional charge would be levied because off Covid/Going Concern. After all, the auditors would have been aware of this additional work before undertaking it.