Year end postings - The Book-keepers Forum (UK)

Cheshire · Master Book-keeper

Year end postings

Shamus · Forum Moderator & Expert

Hi Joanne

Sounds as though the previous bookkeeper didn't understand accruels and prepayments and was looking for an easy way to get their head around it.

The reality is that the up front payment is a deposit and has created a liability until the work is fulfilled when it becomes a sale.

The big question is why has the accountant not picked up on that as the accounts will have been overstating profit and understating liabilities by the amounts of deposits held at the period end.

Or has the accountant been spotting it and sorting it out through the accounts in which case did the journals fed back from the accountant reflect that?

Speak with the accountant and tell them what the previous bookkeeper was doing and get feedback for moving forwards (If you want to quote something at the accountant say "Doesn't this disagree with the treatment per IAS18 and FRS5 application note G?" (International and UK reporting standards respectively)).

kind regards,

Shaun.

Cheshire · Master Book-keeper

Hi Shaun
The Accountant hasnt spotted it as the business in their first year, so this will be the first time the Accountant will get their sticky mits on the books, but also this is how the franchise direct things should be done, but hence my question now as I want to make sure its right before the Accountants get it.

So (just thinking out loud!)really I should be putting the deposit in as a liability, only creating the invoice once all work is done and they are paid for all of it (Which then delays the VAT payable too, of course).

Does it make any difference if the deposit is non-refundable?

FoxAccountancyServices · Expert

Hi Joanne

Its possible the bookkeeper did things way in order to pick up the VAT. My dealings with deposits in the past (large local furniture company), showed that the deposit was entered onto Sage as an SA, and the bookkeeper made a manual adjustment on the VAT return to account for the VAT on the deposits held. After the first manual adjustment was made, any further quarters were balanced by adjusting for the VAT on the movement on the deposits balance. This was advised by HMRC after a VAT investigation.

When the accounts were prepared, we made a non adjusting entry on the accounts production software to move the year end deposit balance to creditors (payments received on account). This corrected the debtors figure to being what was actually invoiced but outstanding, and gave the correct creditor. When I say non adjusting, I mean that it wasnt given to the client at the year end, as it was simply to make the accounts presentation correct.

The bookkeeper has tried to avoid the need for the manual adjustment by creating sales invoices, which as Shaun says bumps up the sales figure before its time. The accountant should spot this and take out the net sales that relate to deposits, and move it to the balance sheet creditor. If he then gives you that net total within his journals, you can post it to a new creditor code called "net payments received on account 2012" and you can contra this off as follows... On the day the full invoice is to be raised, create credit notes for the deposit, and then put in the full value of the invoice. The credit note net value, will be posted to "net payments received on account 2012" instead of 4000. The full value invoice will go to 4000. The credit note VAT will reduce what is paid over on the sales invoice - so your VAT will be correct. You can then clear the credit note and the sales invoice with the bank receipt.

What you should end up with is a NIL balance on "net payments on account 2012" - once you have done this process for all the previous year deposits. If its not NIL, you should be able to reconcile the balance to those customers who haven't had their goods yet.

If you then identify anything in this current year, that has been posted to 4000 but related to a deposit, you can do a journal to move those nets to the "net payments on account code 2013". This journal will then be cleared once you raised current year sales invoices/credit notes like I described above.

I would create two "net payments received on account" codes. I've used 2012 and 2013 as an example but you could just put 31.03.13 or 31.03.14 - anything that identify which financial year you are working to.

Moving forward, you could create invoices for deposits taken, but instead of posting them to sales, post to this years "net payment received on account" code. And again post a credit note and sales invoice when the time comes. That would save you doing manual adjustment on the VAT return, mean that you were paying VAT over at the correct time, and mean the profit and loss was correct.

I've lost myself in all that writing so if it doesnt make sense, sorry! Ask away and I'll try and be more clear!

FoxAccountancyServices · Expert

Ps.. I would imagine that there will be a discussion between client and accountant to determine any deposits that will not be refundable, and and adjustment will be made to write these off to the profit and loss. Not really for you to worry about. Just get your head round the postings :)

Shamus · Forum Moderator & Expert

Hi Joanne,

A non refundable deposit simply means that the client cannot have their money back in the event of their cancellation.

If the work is not performed to the right standard in a timely manner the client can still get their money back. Until the work is done the money is still a deposit regardless of the critertia that the franchise puts on it.

The deposit itself is not a sale but rather a reservation of a service taken as an advance payment on account which is a creditor until the work is performed at which stage it would be moved, along with the rest of the payment now received to revenue (or worse case scenario lower a bad debt).

In that way the revenue is recognised in the period to which is relates.

For VAT there are multiple tax points being created as the deposit itself is a tax point (the deposit will include an element of VAT).

The final invoice will of course be the full invoice but the way that it read in your original post was that the existing bookkeeper had been taking the deposit as a sale in itself rather than simply an advance payment on the final invoice so recognising it as revenue in the current period rather than a creditor.

If you consider deposits as loans from clients repayable either in goods, services or by reimbursement then it all fits into place.

It is still right that the client receives a deposit invoice with a VAT element. Just that it is recorded as a creditor and then resolved by the final invoice which recognises the revenue.

For the VAT part of it here's a handy link that should explain things better than myself :

www.hmrc.gov.uk/vat/managing/special-situations/instalments.htm

Hope that makes sense. If these had been immaterial items I would not have made anything of it but as deposits on kitchen instalations I assume that every client is material.

kind regards,

Shaun.

p.s. doing this right as per UK and International financial reporting standards will lower first year profits which may not look good for a franchisee and in extreme circumstances could cost them their franchise.

But doing it incorrectly could be perceived as fraudulent financial reporting due to earnings management of pulling sales into the wrong period.... Unles it was actually a real sale in which case it would have been the whole invoice with a two part payment plan rather than two seperate sales.

As I say, talk to the accountant about when the revenue should be reported. At least now you will be doing that from the perspective of knowing that there is an issue over revenue recognition timing here that is defined in statute. (Financial reporting standards being given such status by the companies act).

Shamus · Forum Moderator & Expert

Hi Michelle,

we crossed in the post.

sounds as though we are in agreement, I think, in that the accountant could journal adjustments at the year end which would resolve the issues provided that the accountant is able to differentiate between what is a deposit and what is a sale which it sounds as though the previous bookkeeper has not made that easy.

Think that you should do all the techie answers and I'll do the laws and regulations and between us we've got this ere bookkeeping milarky covered.

talk in a bit (off back to finishing off reading ISA550 and IAS24 in original form (yuk... But unfortunately neccessary yuk)),

Shaun.

FoxAccountancyServices · Expert

I think we have hit a home run between us Shaun :) Team work!

Yes, I do not envy the accountant for working that muddle out. Hopefully there will be narrative on sage to show its a deposit.

Enjoy your ISA5.... oh god, sorry I just fell asleep! ;o)

Cheshire · Master Book-keeper

Hi Michelle and Shaun
I dont like the way the franchisor insists on the ways that things are done (including trying to foist new, and have to say rubbish, software on my client). The good thing is my client doesnt want the software and is happy to tell the Franchisor to go hand and also to go with what I and the Accountant recommend in terms of keying/presenting stuff. I will certainly alert the Accountant to what I have done to date and then introduce the system Michelle suggests (for non manual adjustment of VAT - I hate doing that and can easily lead to mistakes/forgetting to put things straight next quarter - well it does with me around) and will also notify him thats what Im doing. Saying that Michelle - I will have to print off your workings so that I can go through them slowly and logically to get it right cos on first reading it busted my head (only because its on so much overload with stress at the mo!). The lower sales figure for the first year in business will I dont think cause him to lose the franchise - the Franchisor is aware of every single sale he does as he does it - they I expect may ask a question or two of why its not all showing so I will speak to my client to pre-warn him. At least I will not be in breach of financial reporting standards doing it correctly! Plus I so prefer to do things right in the first place.

Thanks, as ever, for your full responses - muchas grassy ass wink

Cheshire · Master Book-keeper

Shamus wrote:

sounds as though we are in agreement, I think, in that the accountant could journal adjustments at the year end which would resolve the issues provided that the accountant is able to differentiate between what is a deposit and what is a sale which it sounds as though the previous bookkeeper has not made that easy.

I seem to be picking up muchas messes from previous book-keepers (hence the stress levels at the mo as they are all at year end and late!!). One good thing - there is an amazing spreadsheet showing deposits and completions - with dates, so it should be fairly straightforward to work it out - but ask me tomorrow when Ive had time to look at it all! haha

FoxAccountancyServices · Expert

PS.. Joanne.. I forgot to say.. Do chat with the accountant, and tell him what you plan to do, and ask if the way he will adjust things will work with your plan. He should be able to provide you with a breakdown of his adjustment to sales, even if all he does is print the sales code and marks the items - and you can then tick this up, as you adjust to eliminate entries that have been finalised through to sales invoice. This will highlight any balances that remain as a deposit, and no doubt help him determine any future write offs. That's why I would create yearly codes for the payments on accounts, as it helps see whats old, as well as stops everything from getting mixed up together.

Team work is the word of the day, people!

Cheshire · Master Book-keeper

I will talk to him first, the yearly codes is a good idea. Am liking the team work - one lines it up and other sticks in the back of the net! Well - ok you both score.

Shamus · Forum Moderator & Expert

Cheshire wrote:
I seem to be picking up muchas messes from previous book-keepers (hence the stress levels at the mo as they are all at year end and late!!). One good thing - there is an amazing spreadsheet showing deposits and completions - with dates, so it should be fairly straightforward to work it out - but ask me tomorrow when Ive had time to look at it all! haha

unfortunately there's a lot of bookkeepers out there who just don't understand where in the financial statements their input will end up or why or the regulation behind it or in some cases even the basics such as Accruals and Prepayments.

Of course, whilst sometimes its just plain wrong how its been done (as seems to be true of this case) in other situations there are often multiple right ways of doing something and like yourself I seem to have been blessed with only ever seeming to pick up the books from those who either do it incorrectly or don't do things in exactly the same way as myself which whilst not incorrect doesn't make my life any easier (easy = fast, fast = more available time, more available time = more earning potential. Therefore easy = more money).

I have found that where a client is still quite new as seems to be true here and first accounts have not been filed then it is often better to restart from scratch than carry forward the mess of the previous incumbant.

Where I cannot do that then via the engagement letter I get the client to sign acceptance that the previous years closing balances were correct and are entirely their responsibility. I then enter all of the opening balances (down to each client account balance level... Thankyou VT for the batch load facility) and restart from scratch for the current year but of course my fresh start approach in that situation loses their nuts and bolts level prior years transaction histories so a bit of swings and roundabouts.

Right, back to accounting and audit standards for me,

Talk later,

Shaun.

p.s. don't stress. As the client is onto their second bookkeeper before they have filed their first accounts I'm assuming that they could already see that there were issues with your predecessor which will make getting them onto the straight and narrow so much easier.

p.s.2 was the software that the franchisor attempted to force on your client one that we would know?

FoxAccountancyServices · Expert

Im having a sh*t day!

Just wanted to get that off my chest!

Shamus · Forum Moderator & Expert

wazzup foxy?

Clients, Accountants, previous bookkeepers or software?

With the first three just imagine holding them under the water until the bubbles stop and you'll feel so much better.

With the latter one I'm sure that software sulks but it has a short memory so go off, have a cuppa (or glass of something stronger) and by the time you get back it will have forgotten what it was sulking about.

... I'm probably never going to have a career on an IT helpdesk am I?

FoxAccountancyServices · Expert

Client! I give him a letter of engagement - bog standard letter issued by the AAT. Due to a problem with his last accountant, he says he wants it in writing that I will provide all transactional data to support the accounts. I tell him (in writing) that I will be happy to provide all my working papers once he has paid his bill, regardless of whether its in the letter - PDFs via dropbox. He is insisting I "agree" to this term and agree to helping him with a bookkeeping system that hasn't even been decided yet. I have told him again, while I am not obliged, I will still give him what he wants, and I have said the new bookkeeping system will be covered by an additional letter once its all been decided what is going to happen. Hes not happy with that! Calls it a flimsy promise!

Cheshire · Master Book-keeper

Michelle - sounds like Shaun's idea of bubbles might be a good one for your client, plus at least a couple of mine! Ive de-stressed a bit now by having (a late) lunch whilst watching the Great British Bake Off - now Im just stressed as I cant make my cakes look as good theirs!

Sounds like Michelle's new client has had a problem in the past - wonder how many peeps he has lost along the way and is it really worth it? (Mind you cant really say that or might turn too many clients away!

Right - best get back to it, loads to catch up and a VAT inspection to get ready for (for my amazon/ebay selling non keeping proper sales records client, that will be fun then!)

Shamus · Forum Moderator & Expert

A flimsy promise backed by being a qualified accounting professional governed by an ethical code of practice where page one, paragraph one is concerned with integrity.... i.e. we don't lie.

If a client does not trust their professional representative then what sort of working relationship exists?

The client actually has no legal right to your data or working papers so even a promise is better than their entitlement in law or professional obligation (they have a right to a signed set of final accounts and the trial balance upon which that was based plus the return of all of their own books and records which they gave to you. Everything else is yours).

It sounds like one of those clients who think that they are paying for the service so own you... Had one myself who would think nothing of phoning at 11 at night with the most inane what if questions as they felt that they had basically purchased 24/7 * 365 assistance.

Might be time to adopt the approach of "this is what your getting, take it or leave it. If you don't trust me then I'll take that as a leave it".

Sometimes dumping these ones early saves you a shed load of grief further down the line.

FoxAccountancyServices · Expert

He seems to think that if I agree to the term "I will supply you with the data" that he then has a legal obligation to it? Is that not the case?

Shamus · Forum Moderator & Expert

Actually yes...ish

your rights are restricted by agreements that you make either implied by past practice, in published policies or by suitably specific statements where it can be proven that you said something (his word against your is just hearsay).

Any agreement that you make is a two part arrangement in that your have a legal obligation to perform in exchange for a legal obligation of payment.

The lack of payment supercedes the agreement to perform or to supply pretty much nullifying your obligations under the agreement unless you have previously worked in that way in which case past practice creates a binding obligation.

The above was from memory so you might want to confirm it but pretty sure that you will find that it's correct.

The case law for past practice is Brogden vs Metropolitan railways (which I remember as I used it to walk out of a job with a three month notice period on the same day when my department was sold to a management consultancy that I did not like and did not want to work with so provided that I did not turn up at work on the first day of the new company I had not agreed by words or actions to the arrangement).

FoxAccountancyServices · Expert

I have told him I would give him all the papers once he was fully paid. Really feels like he is creating something out of nothing. I wouldnt withold the information anyway. ts the attitude I am getting from him.. treating me a bit like an idiot... or a petulant child!

VinceH · Expert

"The client actually has no legal right to your data or working papers so even a promise is better than their entitlement in law or professional obligation (they have a right to a signed set of final accounts and the trial balance upon which that was based plus the return of all of their own books and records which they gave to you. Everything else is yours)."

Ah, feck, good point. I've very recently given a non-payer the boot, along with his paperwork and a backup of the work I'd done for him in Sage. I should have held onto that backup until he's paid (which, unsurprisingly, he has yet to do).

FoxAccountancyServices · Expert

Vince, sometimes its worth giving it, just to get rid and have done with it. I am so stressed I actually have pains in my side! Not worth it!!

Shamus · Forum Moderator & Expert

Has he heard of a legal right of Lien?

Basically you have the right to retain whatever you see fit (#1) including the right to retain the books and records until payment is received.

Sounds as though he is attempting to bully you into getting everything his own way.

Is holding onto this client worth being treated like that?

Shaun.

#1 Must have been obtained legally (which it is when the client gives you the books and records or they were produced by you in the first place).
Such is more restricted for limited companies than sole traders and partnerships as the companies act requires such to be kept at the registered office which trumps lien.
Hotel owners and those in the legal profession have much better rights of Lien than we do (a hotel owner can keep everything of yours including your clothes but they are not allowed to retain your horse).

Cheshire · Master Book-keeper

I like the fact I do not have to provide a backup of my data, unless I want to - which I do if they are fair by me (and have paid me). I do see the other side though as Im now working for a client who only got the Trial Balance after falling out with their Accountant, despite paying him and offering to pay extra for the workings. Another person before me spent months trying to back track and re 'constitute' it all and left with stress. Now I have been asked to 'prove' all the figures in the Balance sheet by the new Accountant so that he can prepare the accounts - Ive only managed to prove a couple of lines so far and that took me all day. Oh and guess what - the deadline is end of October as their year end was Jan. Nightmare. But Im not stressing - as I said to both of them 'Im not a miracle worker, I can only do my best!''

Shame about the backup Vince - lets hope you get paid anyway eventually, although sounds like you are not expecting too. But thats whats great about this site - you learn something new everyday.

Michelle - do you REALLY need this one? Is this is what he is like now..........

Keep smiling everyone - its Saturday!!!

Cheshire · Master Book-keeper

Shaun
Does the Companies Act ONLY require you to keep the Annual accounts at companies house (rather than the management)? Twas my understanding! Glad to know I can get my horse back!

FoxAccountancyServices · Expert

I don't actually see any of the records, I just get bank and paypal CSV reports to rejig, with a sales invoice list, then I request PDF of any items that need reviewing (not VAT reg, thank god). That's why I want the letter in place, so he understands that I can only prepare the accounts based on his information and explanations. The only thing I am giving him is the reworking of those spreadsheets, and then any new schedules to support all the figures in the accounts. But it all my work, nothing of his.

We have already had words last month, because I found a couple of old errors and had to go back into previous years, to work out how to fix them. I mentioned that I would need to charge a small amount extra for that work, despite that it took me a good few hours, and he threatened to go somewhere else, despite that he knew I had just done about 30 hours in 3 days on the accounts at that point, working with him till all hours online, trying to pull it all together. If you knew what I was charging him, you would probably laugh your head off. Its more than the last accountant but a lot less than some would charge, for what is involved. Its not the discussion, so much as the attitude. Very off hand from the off. Spit dummy out, think about it afterwards. Not sure I trust him anymore, to be fair! Such a shame, I am sure hes a nice guy. I have always taken an interest in his life, and never been anything but upfront and accommodating with him. What can you do?

FoxAccountancyServices · Expert

Shamus wrote:
Has he heard of a legal right of Lien?

Basically you have the right to retain whatever you see fit (#1) including the right to retain the books and records until payment is received.

Sounds as though he is attempting to bully you into getting everything his own way.

Is holding onto this client worth being treated like that?

Shaun.

#1 Must have been obtained legally (which it is when the client gives you the books and records or they were produced by you in the first place).
Such is more restricted for limited companies than sole traders and partnerships as the companies act requires such to be kept at the registered office which trumps lien.
Hotel owners and those in the legal profession have much better rights of Lien than we do (a hotel owner can keep everything of yours including your clothes but they are not allowed to retain your horse).

Does this apply though, if I am saying he can have them after he has paid?? I thought I was giving them as a gesture of goodwill, as surely he is paying me for the accounts etc.. NOT for my paperwork?? But if I state in LOE that I will give him the data after payment, surely then I am legally obliged to give it?

I dont get it

VinceH · Expert

FoxAccountancyServices wrote:
Vince, sometimes its worth giving it, just to get rid and have done with it. I am so stressed I actually have pains in my side! Not worth it!!

There is that! Doing this client's work was indeed very stressful - a very, very messy job. And not getting paid just added to the stress.

(Given that I'm approaching the first anniversary of discovering my blood pressure was ludicrously high, stressful jobs are not in my best interests.)

Shamus · Forum Moderator & Expert

Hi Joanne,

Management accounts are only prepared for internal use so there is no requirement for those anywhere but internal to the company.

Companies house is only the statutory accounts.

I think htat the only major link between management accounts and statutory accounts is where companies produce segmental information that is prepared on the basis that it is prepared for management rather than on the basis of the rest of the financial statements but to my knowledge that is the only real crossover between the two and thats pretty much Plc only territory.

Yes you can have your horse but you may have to do a Lady Godiva... Wonder if that story started with a lost purse at the Coventry branch of Ye Olde Holiday Inn?

FoxAccountancyServices · Expert

Vince, can you take him through small claims for the work done?

Shamus · Forum Moderator & Expert

FoxAccountancyServices wrote:
Does this apply though, if I am saying he can have them after he has paid?? I thought I was giving them as a gesture of goodwill, as surely he is paying me for the accounts etc.. NOT for my paperwork?? But if I state in LOE that I will give him the data after payment, surely then I am legally obliged to give it?

I dont get it

Yes, it applies. You keep everything whether from goodwill or not until payment is receieved... Unless he's limited n which case you cannot keep the books and records which must be kept at the registered office... Although many clients don't realise that and pay up on the threat of retention even though you know that you cannot keep them.

Once they pay then they have fulfilled their side of the contract and you give them everything that they are entitled to and everything that you have promised.

Always keep in mind that once given up you have nothing left to bargain with.

FoxAccountancyServices · Expert

Well at the moment, I have told him that whilst I am happy to give him my records once he has paid, I am not prepared to obligate myself to it, until I have spoken with the governing body and confirmed that my insurance would cover any legal action, say, if I lost it all, or I was dead! I mean, I back up, and I intend to live forever, but you never know!! The LOE is the AAT one, so I dont want to make changes without first being sure they can be covered. Never done anything like this before, so.......

I have said to him that he has it in writing in my email, that I will give him the data despite not being obliged, but he wants me to be obligated.

Cheshire · Master Book-keeper

Vince - I agree with Michelle - worth a punt and its only about £60, in fact you can do it for less online these days, so Im told. I had one of these - they paid up just before I went online to start proceedings. If he is a Ltd company and owes you more than £750 then you can stitch him up good and proper by going to court (can even close him down for that amount - eventually) - so if he is Limited then maybe just the threat will sort it out. Although if its too stressful to consider then dont as life is too short and precious so then put it down to experience (lets fact it you will not give up your backups again!). Im hoping for you that the backup you gave him has mysteriously been corrupted!
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Does this apply though, if I am saying he can have them after he has paid?? I thought I was giving them as a gesture of goodwill, as surely he is paying me for the accounts etc.. NOT for my paperwork?? But if I state in LOE that I will give him the data after payment, surely then I am legally obliged to give it?
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I think what Shaun is saying that you dont have to give them, only the statutories, rather than your working, although if you have stated in a written document that you will give him those workings then you will. Even if you just say it verbally it can form a contract, although him proving it might be difficult. What you need is some 'conditional' legal jargon in your doc - you could build in you will give him blur blur, but only upon payment of all outstanding invoices for work completed, blur blur. You might need to add something to the tune of ''if the bill is disputed, you have the right to retain the workings blur blur - do you know a friendly solicitor who might draw you up a line or two on the cheap (or even for free?).

Just a thought though - sounds like he is ready to up sticks - as you have produced work for him before without a problem, as his attitude is changing etc - so it sounds like he is trying to make sure you play ball before telling you he is off!! Maybe just do an about turn on him and say you are not going to change the wording! As you said to me (yesterday I think) - dont get stressed its not worth it. Seriously - take a break and treat yourself and come back to the problem another day (it does often work wonders!)

Shaun - Ive just tried the Lady Godiva bit and been arrested!! I was outside Ye Olde Premier Inn by mistake.Will be on the News at 10.

FoxAccountancyServices · Expert

Hi Joanne, thanks for your words of encouragement. Its going to be me that up sticks, I think. That's why I wont bind in to any bookkeeping at the moment. He's had no reason for his attitude except for his past experience, which I have explained isnt my fault. Seems like such a mountain out of a molehill! At this point, I am not even bothered about walking away and losing out on the fee. I cant (and wont) file anything until he has signed, and the only thing that he can do is take my drafts and get someone else to file them, as they are. I'll contact AAT on Monday and see what their advice is on the re-write. Hopefully they will help. He can have the workings, for me, if he has paid.. not got a problem with that. Means nowt to me if he has paid, they are all ready for him, in fact, spent this morning doing it, until got his email of one liner "I am not signing the contract then" Ive just gone back and told him that I am not going to change anything until Ive taken further advice - that I am not prepared to do anything that means HE wont get a pay out if there is a dispute

Vince, MoneyClaimOnline is a great online service. £35 I think. I had a client, a few years back, who took off without paying. One CCJ and some installments later, and we are all clear!

Cheshire · Master Book-keeper

Absolutely sounds like you have a great plan of action. He sounds like he should be in playpen!! His past experience isnt even an excuse when you have offered what you have, lets face it you dont even have to give him the drafts if you want to be awkward.

Sometimes when someone plays awkward like that with me then I just get all the more sweetness and light in my dealings with them (whilst still not giving them their own way, of course) - they usually find it hard to argue with someone who is just being lovely. Its a bit hard work to pull it off sometimes though but mostly works!

Now go and get yourself a nice big cool glass of wine and chill.

Hugs!

FoxAccountancyServices · Expert

Cheers Jo, sorry to have hijacked your post :)

Shamus · Forum Moderator & Expert

Cheshire wrote:
Sometimes when someone plays awkward like that with me then I just get all the more sweetness and light in my dealings with them (whilst still not giving them their own way, of course) - they usually find it hard to argue with someone who is just being lovely.

Hang on a sec, isn't that the way that you work on here as well ya lil minx... Tut, and here was me thinking that you loved us all, lol

FoxAccountancyServices · Expert

Hahaha, Shaun! You dont miss a trick!

Cheshire · Master Book-keeper

Shamus wrote:
Cheshire wrote:
Sometimes when someone plays awkward like that with me then I just get all the more sweetness and light in my dealings with them (whilst still not giving them their own way, of course) - they usually find it hard to argue with someone who is just being lovely.
Hang on a sec, isn't that the way that you work on here as well ya lil minx... Tut, and here was me thinking that you loved us all, lol

Oops - sussed!! Im just 'lovely' - so Ive been told. Although I can argue til the cows come home if needs be!! And win!

Cheshire · Master Book-keeper

FoxAccountancyServices wrote:
Cheers Jo, sorry to have hijacked your post :)

Absolutely no worries! Have a great evening all - Im offski for wine. Hic

FoxAccountancyServices · Expert

Bubble bath for me! Think I will switch off my work email to phone so I can relax without any further "hit the ceiling" moments :)

Have a great saturday evening, y'all xx

VinceH · Expert

"small claims court"

Yeah, I know exactly how that works, having used it on behalf of a client many times - though we haven't had to do it for quite some time; that client's customers may have learned their lessons! I will go that way eventually, but not yet. (For the record, though, yes it's a limited company, and it's "a touch" more than £750!)

Amanda · Expert

HI Michelle,

If its any consolation I have had a sh*t month not just 1 day but a whole bloody month of it. Onwards and upwards tell him where to go if you are really not happy about the situation! Unfortunately you try your best but then sometimes that still isn't good enough for the client. Sounds like he will be a real pain in the bum as time goes on, some just ain't worth it!!!

Sorry if I sound harsh but if you had sat in my seat for the last month you'd understand why. There are plenty of nice 'paying' customers out there.

Joanne - Sometimes being nice just isn't worth it!!! I had one that owed me money (he has paid now), I sent him text after text, (he doesn't reply to emails), and about a month ago I sent him a very blunt text hoping that he might actually think about things and maybe even p*** off but guess what.................he came back for more! Appologised for being busy brought round the next batch of paperwork. Well I know when the next invoice is due there will be plenty of blunt texts to get my money again and then to get the next batch of paperwork. Unfortunately some you just can't tame, you try your best but hey ho.

I'm fed up of being nice!

FoxAccountancyServices · Expert

Hi Amanda. Awww ((hug)).. sorry to hear its been poo! Gets you down doesn't it? Wish I could have seen his face when he got that text! You rock!

I have sent a very fair email, basically reminding him that there was already an implied contract in place, one where I wasn't obliged to hand my records, but where he was still obliged to pay for the work I had completed, and that, if I had just gone ahead and filed the accounts, in order to get the money, he wouldn't have been insured. I have explained that, in actual fact, the letter only really served to protect him, as there are no terms on it, that aren't general, anyway.

I have told him I no longer feel I can work with him, after this. And, I have given him options.

I have told him that he will have to pay for the drafts he has already received, regardless, and that I will reduce his fee by £X to account for the CT600 and online filing work not being done. I have told him if he pays, I will give everything to the person that does the finals, and support them with any questions. But, I have also said that I do not give my permission for the figures to be used by anyone, if he doesn't pay.

The other option is that he can sign the letter and I will finalise everything, and once he has paid, he will be given all the data he has asked for, as well as, all the accountant stuff. I have suggested he put a note on the letter, that states an auto-disengage date, if it makes him feel more comfortable.

I've said there will be no hard feelings, no matter his decision. Tried to be fair... kind but firm. Explained that I was uncomfortable about his lack of trust, and that it was pointless to continue in that vein.

I did feel a little bit bullied by him earlier today, I would have hated to have been on the phone or in front of him! Email lets me collect my thoughts! I wouldn't normally put stuff like this on a public forum, but I am hoping it helps others, in some way. I feel a bit lost over it all, I wasn't trained for this bit! LOL. I just like to do my work and have everybody happy... but it is what it is.

Hope you feel better hun, just put up a winge on here if you need to. Sod Joanne, she aint having her thread back now! :OP

Cheshire · Master Book-keeper

Good morning all
Well Michelle - I was liking your latest comments - until I got to the ''Sod Joanne'' bit, but I will be ultra nice and say it made me smile! Im dying inside - lol. Actually I think you have dealt with him as fairly as you could and if he ever sits back and reads your email properly he will realise he was being unfair. Or maybe he will not because he is the kind of bloke who just doesnt get it. Either way - you do not need nor deserve to feel bullied - that I think is supposed to be the best part of being self employed as you can tell them to sod off. I had to deal with loads of idiots like him in my previous job so Ive lots of practice but it is still hard to deal with when it happens! When he responds, if it is nasty or moany - then just close his email and do NOT respond for several days, do NOT be at his beck and call, at least take back what little control you can! Even if he chases you - only respond when you are ready. You go girl.

Amanda - Im sorry that you have had a bad month too. Sounds dreadful - not good at all and I hope this month starts to get better. But it sounds like you are still being far too nice with this customer. Take one part of his daftness as a compliment - he clearly rates your work otherwise he would go elsewhere, but other than that - dont take his his s..t anymore - put your best nice face on and tell him you want payment up front!!

Have a great Sunday

FoxAccountancyServices · Expert

Morning Joanne :)

Aww I take it all back, I love you really ;0)

He came back with a super loaded email! He suggested that my renegotiation of the fees last month disrespected the contract and him as a client, and started telling me how I should run my business. He is acting like I wasn't giving him an option.. but I have replied explaining that I didn't just do the work and then send a bill, I offered to do the extra work and gave him the option to accept. I think that was fair play. I also mentioned that he had been taking the p*ss, sending me any old crap and that once he heard the words "extra fee" he suddenly started paying attention to what he was sending. I told him that threatening to leave, without even waiting for a revised fee, had set the tone for the whole conversation, and that I didn't think it was called for. At the time, he actually thought it was acceptable for me to work out all the answers to my questions for myself, despite that it was adding hours to the job and he could answer them in minutes, as he was there at the time!

He says if I don't do 100% of the work, he wont pay anything. I have told him that he has the drafts and that he could use them if he wanted to, so he has benefited from the work done so far.

He says I haven't agreed to give him the paperwork.. I have re-iterated that I agreed to give him all the paperwork despite no obligation. I have highlighted in bold that I even offered to contact my governing body to check I could change my LOE to give the obligation, but that he wasnt even happy with that. I've explained that I have already told him that am not prepared to commit to anything without first checking I am allowed, and that it wont affect my insurance, and that its tough if he doesn't understand or respect that. I've pointed out that in none of his replies has he said "ok, ask them, and we will take if from there". I have explained he is being unreasonable while I am trying protect us both and do things properly.

I've left it saying I will not do anymore work for him, and that I do not give my permission to use my draft figures until he has paid and they become his property. I dont even care if he doesnt pay, he just has to get someone else to start from scratch.

Really not worth the effort and I just dont know where I stand over the work I have done so far, and billing for it, anyway. I guess its my own fault for not getting the letter sorted before I did anything, and all I can really do is tell him he cant use my figures and then take the hit on the work. He sees the LOE as not being part of the original agreement now, and I suspect he has a point.

#Lessonlearned, people

VinceH · Expert

Wouldn't business be so much better if we didn't have clients?

Cheshire · Master Book-keeper

It sounds like it is best left for now, for things to calm down otherwise you are probably just wasting your breathe. Interesting he says you have a contract (at the beginning of your note) but then that he doesnt see LOE as part of the original agreement - but any court in the land will not just dismiss it out of hand just because he says so - remember that emails and conversations form contracts too - you can still take him to court idc for any outstanding payments. Many cases have been won with no formal written contracts in place. If I were you I would just chase your invoice in the usual manner and like I say respond to his emails but certainly not immediately by return, but sufficiently that if it does go to court that you continue to be seen as reasonable and he does not. If you decide in a month or so that you would prefer not to chase him for the o/s bill as you dont want the hassle then let it lie. You cant always win in life - even being fair and reasonable as there are just too many sharks out there. Dont let it spoil any more of your weekend. Keep smiling lovely lady!

FoxAccountancyServices · Expert

LOL! You're not wrong there, Vince!

If you mess with the bull, you get the horns!