Chapter 10 Ceasing to act Flashcards
10.1 Ceasing to act
A member must not act if they consider client’s instructions to be a risk of assisting criminal activity. A member who has accepted a client’s instructions should not cease to act for the client until the relevant work has been completed unless:
• They are obliged because of legal or professional obligations
• The client requires it
• A member gives reasonable notice to the client of their intention to cease to act. A member will have due regard to the terms in the engagement letter
A member should continue to act until they have taken reasonable steps to notify the client. They should write to the client and it is recommended they address the following in their letter of disengagement:
• A summary of services provided up to the date of ceasing to act
• A note of any further action to be taken by the member
• A note of outstanding matters
• Details of impending deadlines and the action required
• A member’s willingness to assist the new advisers to resolve outstanding matters and provide copy papers to the new advisers
• Details of outstanding fees
• A note indicating whether a member or their successor is to advise HMRC of the change
A member who receives communication from a successor should ask the client for permission to discuss their affairs with the new adviser. If authority is no given, a member should tell the new adviser that they have no authority and cannot give clearance. If a member resigned for professional reasons that are a matter of public record or they resigned for professional reasons but is not a matter of public record they should tell the client that. Professional reasons are issues such as ethics an integrity, not fees or deterioration of relationship.
10.1 Ceasing to act (2)
Where a member has made a suspicious activity report SAR to the national crime agency NCA, a member should be careful to avoid committing an offence and tipping off.
If a member is asked to hand over relevant papers to the former client or successor they should consider:
• If the request does not come direct from the client, a member should obtain written consent
• If there is a risk the former client could use the information to support a claim against a member, a member should consult their professional indemnity insurers and consider taking legal advice
• Some documents on a member’s file may belong to the client. A member is therefore required to provide these, subject to any lien in place. In the event of a dispute of ownership of documents a member should seek legal advice.
• A member should retain copies of documents handed over, the termination does not change a member’s requirement to maintain professional records, even if a client requests for the return and destruction
• Where documents belong to a member, a member should co-operate in providing copies of documents relating to the client’s ongoing tax affairs. If this is a significant amount of work, or if it is provided in the engagement letter, a reasonable charge may be made
If after ceasing to act, a member receives a correspondence relating to the former client, they should forward that correspondence without delay and advise the sender to address future correspondence direct to that client.
