New Clients and Engagements Flashcards
What should be disclosed to a client when a member pays commission to a third party in return for introducing a new client?
The amount of commission and the identity of the introducer
What do engagement letters include?
The covering letter with a privacy notice, the schedule of services, the standard terms and conditions of business
In which situations would more than one engagement letter be issued?
If a member acts for a husband and wife who are both employed by the same company, if a member acts for a retired coupe.
if a member acted for an individual who has died and is now acting for their representatives
What are the 7 sections that are recommended to be included in the covering letter of the engagement letter?
- Who they act for
- Period of engagement
- Scope
- AEOI
- Fees
- Liability cap
- Client agreement
What are the 3 lawful bases that data controllers should identify in accordance with Article 6(1) of the GDPR?
Consent, legal obligation, vital interests
Are members allowed to pay the full amount of commission received to the client?
Yes, they can also deduct the amount from fees invoiced and show this on the fee note
The standard conditions suggested in guidance to members on engagement letters include specific reference to ‘family’, what is the main reason for this?
This is for data protection
If a liability cap included in an engagement letter is found to be unfair by the courts, what can the court do to rectify the position?
Rule the cap to be unenforceable
When can a member not pay commission to a third party for introducing a new client?
When the third party’s identification remains confidential
What is the first course of action when your client chooses to have a new tax adviser?
Contact the client to request permission to disclose information to the new adviser
What does the guidance on engagement letters not specifically suggest members should mention in a covering letter to an EL addressed to a company?
The fact that professional indemnity insurance is held
What does not need to be in the standard terms and conditions?
The name of the firm’s money laundering officer
What does need to be in the standard terms and conditions?
Name of the relevant legal jurisdiction
Any procedure for holding client money
The name of the person who deals with the complaints to the firm
If you take over a client’s previous tax advisor, and you have heard that they are not particularly competent, what should you do?
You need not take any action unless you are requested to do otherwise
Which three documents are included in the EL pack?
Cancellation notices for consumers
Covering letter
Schedules for various specific services
