I have a new client and the previous accountant will not provide me with a breakdown of last years fixed assets calculations along with the capital allowances calculation. All I have been given is the balances carried forward. I have never experienced this before as usually when ive requested calculations i have been given them. My problem is that I therefore do not know what the balances represent so would it be best to revalue the assets in the business that i know of?. In terms of tax implications am i right in thinking that i shouldnt claim capital allowances because i have no idea what capital allowances have already been claimed and I would have to base it on the cf figure which could be incorrect?
Is the previous accountant a member in practice (ie ACCA ICAEW, AAT.. etc?) All Regulatory body's require their Members to handover all relevant information requested during the handover process.
I would advise asking again and stating exactly what information you need, and add the line that should you not receive this then you will have no option than to discuss this with their regulatory body.
This information is generally available at a click of a button so it should not take a long time for them to do..
I would not go revaluing assets, also with the annual investment allowances, depending on the level of capital expenditure most the allowances may have been claimed in full already...
Easier to ask for a detailed fixed asset register and the tax computation showing the capital allowances claimed.
Hope that helps
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Is the previous accountant a member in practice (ie ACCA ICAEW, AAT.. etc?) All Regulatory body's require their Members to handover all relevant information requested during the handover process.
Hi,
under supervisory body rules the new accountant is entitled only to the trial balance and a copy of the last set of accounts.
All working papers belong to the accountant, not the client and whilst these may be sold to the new accountant (with the clients permission) neither the client nor their new representatives have any right to them.
What the outgoing accountant must do is talk to the new accountants to confirm that there is no reason why the new accountants should not accept the engagement.
But that's really about it as far as professional ettiquette goes. Anything beyond that is either for profit or out of the goodness of their own hearts.
The larger the practices the more likely that the accountants will play ball as next week the shoe could well be on the other foot.
For not affiliated practices then one would stand little if any chance of getting anything at all.
kind regards,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Thanks both I was not sure what information was required to be handed over by regulatory bodies. I have tried to find out if they are a member of ACCA, CIMA etc but havent managed to find out and my client doesnt know. When I took on the client I did ask for professional clearance. I have tried numerous times and so has my client but we can not get the information. I would have honestly thought that a fixed asset register and capital allowances calculations should be handed over because without these I cant see how I can prepare this years accounts and tax return?. The only way I can see to do it is to revalue the assets because i can not see how i can use the cf figures without knowing what they relate to?
Questions and suggestions - apologies if you've already thought of these.
Firstly, is your new client a company or a sole trade? Secondly is there any dispute over fees?
Can you glean anything from copies of the last few tax returns? (approach HMRC). Type of Cap Alls. claimed - for how much etc. Is there a letterhead amongst prior paperwork or invoices showing the previous accountants initialing? Name of signatory on the accounts - name of firm - Google or yellow pages to find out professional body.
At one time, it was usual to include Capital Allowances computations in the accounts folder and the profit computation for good measure.
My client is a sole trader with no dispute over fees. No initials on anything to say what body they are under. All that was given back to my client was his receipts and they will not hand anything else over we even had to contact HMRC for a copy of the tax return!. Further problem is that he has also disposed of an asset and i dont know how to work out the profit or loss on disposal without knowing the NBV. They did provide me with a carried forward figure for capital allowances but again not a clue what it relates to!
Short of hiring a private detective, you're lumbered with making justifiable claims. Identify the largest capital acquisitions by date and amount and work forward as best you can with each years accounting profit as a starting point. Include calculations/methodology explanation in the Tax Return 'white space'. This may not preclude an Enquiry but HMRC would be faced with taking a more reasonable approach than yourself. Again, apologies if I'm stating the obvious. best wishes, Tim
