As an accountant, you are in a position of trust.  Your clients will provide you with access to confidential information to enable you to provide your services, and will rely on you to ensure that their business is compliant with the relevant laws. You owe a duty of care to your clients.  It is important that your clients understand the scope of your services, and the rights and obligations of both parties.

When providing accounting services, you should provide your clients with a Client Agreement which is made up of (i) a Proposal, which can be tailored to each client and sets out client specific details, the services and payment terms, and (ii) general Terms and Conditions to be attached to the Proposal.

Service

You need to clearly set out what services you will be providing so that your client knows what to expect.

It is wise to set out services that you do not provide, for example, that you will not be providing any bookkeeping or payroll work, if they do not form part of your services.  It may be wise to state that you do not provide legal or insurance advice.

Fees, Invoices and Payment

In your Proposal, you should outline what your fees and charges will be, how regularly your clients will be invoiced, and how payment is to be paid. Your Terms and Conditions can state that you have the right to use debt collection services if invoices are overdue and that all services will be suspended until payment is made.

Tax Return Inspections

In your Terms and Conditions you should notify your clients that all income tax returns in Australia are subject to examination by the Australian Taxation Office (ATO). It is possible that you will be required to perform further work if the ATO has any enquiries or needs additional information to substantiate certain items associated.  If further work is required, then the client needs to pay additional costs.

Client Obligations

As you provide your services based on information that has been given to you, your clients need to understand their obligations under the Client Agreement. You can add a warranty to your Terms and which says that your clients agree to provide you with complete and accurate financial information.

Confidentiality

You need to demonstrate your commitment to confidentiality as clients will be providing you with sensitive information. This clause needs to cover how confidential information will be treated and the circumstances in which you will be obliged to disclose it.

Termination

Your Terms and Conditions should include a procedure for termination. You may wish to require that the client provide you with notification in accordance with a notice period.  You can reserve the right to terminate the Client Agreement immediately in certain situations, for example when you consider that a request is inappropriate, improper or unlawful. You should also notify your clients that on completion of the services, client documents may be retained as required by law or any other regulatory requirements.

Limitation of Liability

To protect you and your business, it is important for you to limit your liability. You can state that whilst all due care and skill will be taken in the provision of services, you will not be liable for any mistakes which occur as a result of the client’s negligence. As your services depend on the client’s information and response, you will not accept liability for a failure to perform services which is affected by the client’s delay in response or provision of incorrect and incomplete information.

Website Terms of Use

If your business has a website, you need a Website Terms of Use. These apply to every website visitor, protect your website and limit your liability for your website. The Terms claim your copyright and intellectual property rights, and set out permissible and prohibited uses of your website, including that competitors cannot use your website information.

Privacy Policy

If you collect, use and disclose personal information from customers, including using the information for direct marketing, you need a Privacy Policy, to assist you to comply with the Privacy Act.  The Privacy Policy is between you and each person that you collect personal information from. It sets out what personal information your business collects, how this information is used, and under what circumstances the information will be disclosed to third parties.

To Conclude

As an accountant, the care you are expected to exercise a higher standard than the average service provider. It is imperative that you have a good set of Terms and Conditions to protect not only your business, but you and your professional license. To mitigate your risks, you should speak to a business lawyer to have a professionally drafted Client Agreement which will protect and strengthen your business, legal and professional interests.

Ursula Hogben

Next Steps

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