Bookkeepers and Accountants and Mutual Clients

[numbersrule]

I would be interested in Forum views on the Client - Accountant - Bookkeeper Team and communication protocols.

Specifically, if a Bookkeeper discovers deficiencies in record keeping by the Client and wishes to formally communicate this to the Client because verbal comments seem to be having zero effect, then should the Bookkeeper copy in the Accountant on the communication?

In this example there is no business relationship between the Bookkeeper and the Accountant.

I don't want to say anymore for fear of putting words into mouths!

 

[Daybooks]

Presumably the deficient records are unexplained cashbook entries.

If your letter of engagement is silent on the point consider updating. A clause such as “any unexplained items will be posted to the drawings / directors account.” Be pragmatic about it. Is it simple laziness or evasion and how materialistic is it; without forgetting your AML duties?

If you have no relationship with the accountants then don’t go instigating one unless approached by them. Remain professional and disengage if they become too troublesome.

 

[Ziggy2024]

Raise it with the client. If the deficiencies are not addressed then I would note them in the year end handover, the cloud softwares have note capabilities within them that make this easy now.

 

[MyAccountantOnline]

I would be interested in Forum views on the Client - Accountant - Bookkeeper Team and communication protocols.

Specifically, if a Bookkeeper discovers deficiencies in record keeping by the Client and wishes to formally communicate this to the Client because verbal comments seem to be having zero effect, then should the Bookkeeper copy in the Accountant on the communication?

In this example there is no business relationship between the Bookkeeper and the Accountant.

I don't want to say anymore for fear of putting words into mouths!

It's certainly good for bookkeepers and accountants to communicate but do you have authority to communicate with the accountant in a letter of engagement?

 

[Paul Kelly ICHYB]

If the relationship is only with the client and not the accountant, there are probably data protection issues.

If it is a three way agreement/relationship, you tell the client and cc the accountant.

 

[numbersrule]

It's certainly good for bookkeepers and accountants to communicate but do you have authority to communicate with the accountant in a letter of engagement?

That is a really useful point. Thank you.

 

[numbersrule]

If the relationship is only with the client and not the accountant, there are probably data protection issues.

If it is a three way agreement/relationship, you tell the client and cc the accountant.

I'm not sure about this. Both the Bookkeeper and the Accountant have access to the same Cloud Accounting Software. On this basis I can't see any issue with regard to data protection.

It seems to me that cloud based software providing mutual access for all parties effectively makes all data common knowledge to all involved parties anyway.

 

[numbersrule]

If your letter of engagement is silent on the point consider updating. A clause such as “any unexplained items will be posted to the drawings / directors account.”

Thanks Daybooks. Even though I have been using a Letter of Engagement Template from my Professional Body, it doesn't include really useful tips like that. Thanks again.

If you have no relationship with the accountants then don’t go instigating one unless approached by them. Remain professional and disengage if they become too troublesome.

When I said there is no business relationship I meant the bookkeeper doesn't work for the accountant. But we have a working relationship in the sense that we have been communicating in relation to the bookkeeping and accounting for several months because the EOY Accounts are reliant on the bookkeeping.

 

[JEREMY HAWKE]

I see this all day in business nowadays where a person's skills no longer go beyond their expert subject.
Effective communication and having the ability to stamp some level of authority on key personnel in the business is seriously lacking
The job of the book keeper and accountants goes beyond ticking boxes
You never studied all those years to have your advice ignored

 

[numbersrule]

If you have no relationship with the accountants then don’t go instigating one unless approached by them.

Reflecting on this thread again, the above comment has got me thinking.

I would have thought that a bookkeeper should be able to instigate a new communication with the accountant as and when the bookkeeper sees fit.

 

[GLAbusiness]

In the absence of any specific contract terms between the 3 parties I would expect both the bookkeeper and the accountant to respect the confidentiality of their respective mandates.

Of course, if the client does not wish the 2 providers to share information than the client is an idiot - but that is another issue altogether

 

[Daybooks]

Reflecting on this thread again, the above comment has got me thinking.

I would have thought that a bookkeeper should be able to instigate a new communication with the accountant as and when the bookkeeper sees fit.

Whist communicating with the ‘accountant’ would be very logical just make sure it is covered in your terms of engagement. If it is silent on the point then make it heard.

How will you reply to “You had no right to contact….”?

If you suspect the poor record keeping by the client may be a front to some form of money laundering (in its widest context) then your duties are clear and do not include ‘telling others’.

 

[Newchodge]

Specifically, if a Bookkeeper discovers deficiencies in record keeping by the Client and wishes to formally communicate this to the Client because verbal comments seem to be having zero effect, then should the Bookkeeper copy in the Accountant on the communication?

What do you hope to achieve by telling the Accountant?

 

[Ziggy2024]

What do you hope to achieve by telling the Accountant?

The accountant is then aware of the deficiencies and knows that the bookkeeper has tried to correct them but has been unable to because of the client reticence.

Accountant then knows that it is the client and not a bad bookkeeper and doesn't advise client otherwise (although may still happen).

 

[Newchodge]

The accountant is then aware of the deficiencies and knows that the bookkeeper has tried to correct them but has been unable to because of the client reticence.

Accountant then knows that it is the client and not a bad bookkeeper and doesn't advise client otherwise (although may still happen).

Personally as a client I would be extremely angry if the book-keeper spoke to somone else about my business without my express permission. I think you are more likely to have an issue wit6h that rather han the acountant bad-mouthing you.

 

[Ziggy2024]

Personally as a client I would be extremely angry if the book-keeper spoke to somone else about my business without my express permission. I think you are more likely to have an issue wit6h that rather han the acountant bad-mouthing you.

If the client prevents two professionals from collaborating together then I would advise both professionals to disengage as this is a huge red flag. There is absolutely no valid reason why a bookkeeper should not be speaking to the accountant and it's not always necessary for the client to be involved in those discussions.

This thread is not about going behind the clients back, it is about collaboration between professionals. That's my reading anyway.

 

[fisicx]

It’s very simple. You ask the client for permission to talk to the accountant to discuss findings. That way it’s all open and transparent.

 

[Daybooks]

If the client prevents two professionals from collaborating together then I would advise both professionals to disengage as this is a huge red flag. There is absolutely no valid reason why a bookkeeper should not be speaking to the accountant and it's not always necessary for the client to be involved in those discussions.

This thread is not about going behind the clients back, it is about collaboration between professionals. That's my reading anyway.

A valid reason for the bookkeeper not to be speaking to the accountant might be because the client does not want it (and may be for legitimate reasons - you nor I need not agree with those reasons - but none the less).

The OP states there is no business relationship between bookkeeper and accountant.

As you say the bookkeeper can choose to disengage and then follow any of their reporting obligations if they feel them necessary. We do not know the nature of the discrepancies. Whether relevant here or not: the accountant is not the bookkeeper’s Anti-Money Laundering Reporting Officer. Don’t fall foul of those rules. The accountant will do whatever they need in due course.

Terms of engagements are written for a reason.

 

[Ziggy2024]

A valid reason for the bookkeeper not to be speaking to the accountant might be because the client does not want it (and may be for legitimate reasons - you nor I need not agree with those reasons - but none the less).

This is not a valid reason. It is a red flag as it implies lack of trust, control issues or something to hide. Which was my point in response to the previous reply.

The OP states there is no business relationship between bookkeeper and accountant.

This should be addressed as the bookkeeper 100% needs communication with the accountant.

If there are discrepancies in a client's records then the accountant needs to know.

 

[Daybooks]

This is not a valid reason. It is a red flag as it implies lack of trust, control issues or something to hide. Which was my point in response to the previous reply.

This should be addressed as the bookkeeper 100% needs communication with the accountant.

If there are discrepancies in a client's records then the accountant needs to know.

“I don’t want you to talk to my accountant. I will do that as I understand my business better than you. I am not paying my accountant to have dialogues with you nor am I paying you for your time in doing so. If you do not like this arrangement then please disengage now.”

It is a perfectly valid reason and does not imply lack of trust, control or anything to hide. It is not invalid simply because you wish it to be. The bookkeeper is engaged to provide the service in accordance with the agreed terms. Apologies for repetition but if the bookkeeper feels there is ‘suspicion’ then their legal obligations are clear and they should follow them.

The bookkeeper’s ability to perform their role is not dependent on 100% communication with any accountant. Similarly the accountant needs their own systems and controls not just those of a third party. If the client does not give them access to the bookkeeper then they will draw their own conclusion and act accordingly.

I do not disagree there should be a healthy relationship between client, bookkeeper and accountant. But its absence is not indicative of suspicious activity in itself. We can choose whether we take on a client and choose when to disengage. It is for the OP to decide.

 

[Ziggy2024]

“I don’t want you to talk to my accountant. I will do that as I understand my business better than you. I am not paying my accountant to have dialogues with you nor am I paying you for your time in doing so. If you do not like this arrangement then please disengage now.”

if you don't recognise this as the narcissistic response that it represents then with all due respect we are poles apart.

It is a perfectly valid reason and does not imply lack of trust, control or anything to hide. It is not invalid simply because you wish it to be.

It is not a valid reason and with all due respect to you it aligns perfectly with my previous point.

The bookkeeper is engaged to provide the service in accordance with the agreed terms. Apologies for repetition but if the bookkeeper feels there is ‘suspicion’ then their legal obligations are clear and they should follow them.

The legal AML obligations are a separate point to the point I've made in regards to collaboration between accountant and bookkeeper.

The bookkeeper’s ability to perform their role is not dependent on 100% communication with any accountant. Similarly the accountant needs their own systems and controls not just those of a third party. If the client does not give them access to the bookkeeper then they will draw their own conclusion and act accordingly.

I never said either role is dependant on the other. Neither did I saw either party should rely on the other.

I do not disagree there should be a healthy relationship between client, bookkeeper and accountant. But its absence is not indicative of suspicious activity in itself. We can choose whether we take on a client and choose when to disengage. It is for the OP to decide.

I did not say the absence of the relationship was suspicious, I said the client refusing the relationship was suspicious. It is suspicious and will never end well. Your comments alongside personal experience have not dissuaded me on this.

 

[Daybooks]

if you don't recognise this as the narcissistic response that it represents then with all due respect we are poles apart.

It is not a valid reason and with all due respect to you it aligns perfectly with my previous point.

The legal AML obligations are a separate point to the point I've made in regards to collaboration between accountant and bookkeeper.

I never said either role is dependant on the other. Neither did I saw either party should rely on the other.

I did not say the absence of the relationship was suspicious, I said the client refusing the relationship was suspicious. It is suspicious and will never end well. Your comments alongside personal experience have not dissuaded me on this.

Thank you for your comments.

The hypothetical response from the client given by me is not an unreasonable one. I wouldn’t engage with them either but would respect their right to manage their affairs how they wish.

I have no desire to persuade you from your views. I just try and put forward counter arguments in keeping with the underlying theme of the post and not trying to suggest you have said or not said anything.

One observation is that the lack of communication between bookkeeper and accountant has only arisen because of some ‘discrepancies’. If the OP considers it (or should consider) reportable under AML regulations then opening a dialogue with the accountant to pass on these concerns might not be the wisest move. .

 

[numbersrule]

To all concerned,
There is no AML Risk here.

 

[numbersrule]

Let me put a different slant on this thread:

When a business utilises accounting software, and the accountant gains access to the accounting software at year end, do you think there is a tendency, generally in the accountancy sector to speedily move to draft accounts by taking the accounting software at face value?

 

[fisicx]

No.

 

[Ziggy2024]

Let me put a different slant on this thread:

When a business utilises accounting software, and the accountant gains access to the accounting software at year end, do you think there is a tendency, generally in the accountancy sector to speedily move to draft accounts by taking the accounting software at face value?

It shouldn't happen but it does. Especially if you are dealing with an accountant who has quoted a low fee that leaves them with very little time to properly prepare the accounts.

 

[fisicx]

It shouldn't happen but it does. Especially if you are dealing with an accountant who has quoted a low fee that leaves them with very little time to properly prepare the accounts.

But the majority will do the books properly. Which is what was asked.

Of course there will always be some iffy providers but it not going to be the tendency.

 

[Ziggy2024]

But the majority will do the books properly. Which is what was asked.

Of course there will always be some iffy providers but it not going to be the tendency.

I'm not sure what your point is to be honest. I don't agree that the majority will "do the books properly" as accountants vary wildly in the services they perform and how they perform them.

 

[fisicx]

My point was @numbersrule asked if there was a tendency for accountants to take the accounting software figures at face value. I’d suggest not. They will tend to review the inputs and ask questions if something doesn’t look right.

 

[Ziggy2024]

My point was @numbersrule asked if there was a tendency for accountants to take the accounting software figures at face value. I’d suggest not. They will tend to review the inputs and ask questions if something doesn’t look right.

And I said that there are accountants who will do just that. So, we both commented in the way we saw fit. Therefore still not sure why you replied to my comment.

 

[DontAsk]

Let me put a different slant on this thread:

When a business utilises accounting software, and the accountant gains access to the accounting software at year end, do you think there is a tendency, generally in the accountancy sector to speedily move to draft accounts by taking the accounting software at face value?

That's not my experience. Only last year I marked an invoice as paid in the last day of the year, and reconciled against the bank account, but it didn't actually clear the bank account until the following day (in the new accounting year). My accountant spotted that so they didn't simply accept what the software said.

 

[DontAsk]

And I said that there are accountants who will do just that. So, we both commented in the way we saw fit. Therefore still not sure why you replied to my comment.

I'm not sure why you keep arguing the toss. Just move on. Someone else can have the last word.

 

[Ziggy2024]

I'm not sure why you keep arguing the toss. Just move on. Someone else can have the last word.

I don't know why you felt the need to write that, it perhaps should have been directed at the previous poster who decided to comment on my post.

It's a public forum - don't tell me to move on, take your own advice!

 

[Newchodge]

I don't know why you felt the need to write that, it perhaps should have been directed at the previous poster who decided to comment on my post.

It's a public forum - don't tell me to move on, take your own advice!

To all posters on this part of the thread, please keep it civil.

 

[NortonBishop]

There's a useful point in the messages above that sometimes professionals like to invite other professionals into the process without regard of the cost to the business. I've always sought to be aware of this - it's easy for, say, a solicitor to say, "let's get your accountants in on this meeting" when it's not a cost to them and may not be necessary.

Depending on the role that the client wants to take, that could be a reason not to have a bookkeeper communicating with an accountant.

 

[GLAbusiness]

I don't have a bookkeeper, but I have an accountant and an IFA. We don't have a blanket rule but act on a case by case basis. So the IFA will say to me "is it OK to talk to the accountant on this" and I will say "Yes, please"

 

[Newchodge]

I don't have a bookkeeper, but I have an accountant and an IFA. We don't have a blanket rule but act on a case by case basis. So the IFA will say to me "is it OK to talk to the accountant on this" and I will say "Yes, please"

And that is fine because the business owner is retaining control. My concern would be one professional taking it on themselves to discuss a client's business with another professional WITHOUT confirming they may do so with the business owner. Unless, of course, it is a legal requirement that they do so, ie AML.

 

[MyAccountantOnline]

Let me put a different slant on this thread:

When a business utilises accounting software, and the accountant gains access to the accounting software at year end, do you think there is a tendency, generally in the accountancy sector to speedily move to draft accounts by taking the accounting software at face value?

No