Brief history..I used to do the payroll for a client. I decided to dismiss him as a client 2 years ago because of late payment of fees. This customer has contacted me again asking if I could do his books and payroll again as he's not been happy with his accountant. He has agreed to pay fees in advance. He couldn't understand why HMRC was asking for further payments for PAYE relating to 2011/2012.
Upon examining the wages for 2011/2012 it has come to my attention that the accountants have put the wages in wrong (from the payroll records that I supplied when I ceased doing them). They have input pay for 4 months for employee A, but these wages were actually for employee B, which had been recorded correctly. So basically the accountants have shown the business paying an extra £4000 in wages, that never happened.
The PAYE is therefore wrong and also Employee A's P14 details were submitted with wrong figures showing him earning more than he actually did.
The accountants have said that the responsibility falls with my client to ensure all is correct at the time of processing the wages and producing the P35, but my client wouldn't have known about this input error as it relates to the period that I processed, so he wouldn't have received any payroll reports. The P35 would have just shown a total, which wouldn't really highlight any errors. Is my client correct in asking them to sort the problem out, free of charge?
To add to this error, I have examined the accounts that they have produced for year ended 5 April 2012 and it only shows wages of £19000. The correct wages figure including Er's NI is £34000. To me the accountants seem incompetent. The wages were processed by them!
Any ideas how best my client should deal with these errors & the accountants?
There is some merit to what the accountant says... But not a lot.
Yes, ultimately the client is responsible but the client went to a professional to provide a professional service which does not seem to have been the case in this instance.
If the accountant is qualified (too many are not!) you could take this to their professional body as a possible disciplinary matter.
As you know accountants who are members of professional bodies are bound by the IFAC code of ethics. Section 1.30 states that the accountant has a professional duty of competence and care to the client.
They cannot simpy choose as and when such duty applies.
The threat of going to teacher will probably be enough to (a) resolve this and (b) ensure that the accountant wants no further dealings with you.
I would say that in this instance your client is completely within their rights to require that the accountancy practice puts them back into the position that they would have been in had the job that they paid for had been done properly in the first place.
kind regards,
Shaun.
p.s. from a negligence perspective the criteria have also been fuilfilled in that :
1) an enforceable duty of are must have existsed (check) 2) that duty must have been breached (check) 3) loss must have resulted (check)
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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.
I have advised my client to seek another accountant! I don't think the accountants have helped my client at all. I know that he is not the easiest of clients, but some fairly standard work seems to have been omitted. According to the accountants website they are supposed to be ACMA qualified. I've recently found out as well that they have changed names.
I'm still waiting to hear of the outcome of their meeting!
