I am the bookkeeper of a client who is 4 months overdue for submitting his accounts to companies house.
I have recorded all transactions onto his SAGE Software from the bank accounts invoices, receipt's etc. However, he is missing some receipts. For example he rents out his own office to his business (Ltd) and wants me to charge the business £4k. He also stated he wants me to provisionally increase his expenses (by about £1800). I haven't seen any paperwork for this but he states he can get hold of it if he is investigated.
He is signing and submitting his own accounts -no accountant is involved .
How liable would I be as his Bookkeeper if he was to be investigated and the paperwork was missing??
I am Covered for MLR through ICB with my practice licence.
He also stated he wants me to provisionally increase his expenses (by about £1800).
Hi Sarah
If there is no evidence of transactions occuring for the value of the expenses for £1,800, your client company will be unable to claim.
Your client company can claim if no invoice has been received as yet and there is a contract/ confirmation/ delivery note of goods showing that they have entered into the transaction/ service with their supplier during that accounting year.
If no evidence, just say No (Grange Hill 80's style) to the director.
Ultimately Sarah, he's the one signing the accounts as the director so the responsibility comes down to him. However, you have to decide how you feel ethically about working for a client who potentially could be committing tax evasion (it might all be genuine, but you appear to have concerns over the validity). There is nothing to stop you putting any bits of paper he chooses to give you through the accounts, but are you happy to do it on a 'no questions asked basis'.
__________________
Jenny
Responses are my opinion based on the information provided. All information should be thoroughly checked before being relied on.
How long have you worked for him??? If its quite a long time and you know him well, perhaps tell him kindly that you won't be able to put the figures on without the back up of paperwork first, tell him that as a bookkeeper all figures should be supported by evidence and you are only doing your job. See what he says, if he can't provide the evidence then maybe you should decline to do it. How many hours do you do for him?
The thing is if you are not happy about the situation then don't be pressured by him, its right what Jenny says about he has to sign them off, but don't get dragged under with his dodgy ways, there are plenty of good honest customers about who would dream of doing that.
He probably hasn't got enough money to pay his tax bill hence he is trying everything possible to reduce it.
BudgetB wrote:Ultimately Sarah, he's the one signing the accounts as the director so the responsibility comes down to him.
Hello,
Just thought I would mention that although that is correct, he could try the old 'I don't know what I'm doing, I use a professional for that'.
The ICB has had many a client use that line, and as your seen as a qualified professional you need to prove you told him what the law was, otherwise you could be found at fault if he does get inspected.
Just make sure you keep notes on what you do and why (and any emails from him etc), but like Dalbir says, if no evidence just say no.
