Slight ethical issue, advice required

Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
We have a charity client. My ex-partner dealt with it, and it looks like we are doing the bookkeeping AND the independent examination. I know, it can't be independent in this case!

The other thing is he was doing the bookkeeping for free as a favour, and the exam fee is about £10 a month.

Having looked at their file, no bookkeeping has been done for this year (year started in October).

I have a dilemma. 1, do I want to do the bookkeeping for free? Can I actually do it for free (see below) 2, I can't keep both the bookkeeping and the exam, as it needs to be independent. If my bookkeeper does the BK and I do the exam, does that qualify?

While I would love to be able to offer some free/cheap work to a charity , I'm not sure the current business structure can support it. I've not looked at how many hours work is involved yet.

What would you do?


  • Rachel
    Rachel Registered Posts: 348 Dedicated contributor 🦉
    hmmm a tricky one.

    Was it a charity close to your ex partners heart, could you not pass it across?

    I would probably continue (with one or the other) but I am not busy, but if it doesn't make sense to you tell them that you can not do the independent review and the bookkeeping rate is x.

    Sorry not much help,
  • T.C.
    T.C. Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
    I do an charity's independent examination each year and think that to be independent, you should not be doing the bookwork too. Check out the charity commission's site information on IEs, but that is my opinion.
  • burg
    burg Registered, Moderator Posts: 1,441 mod
    Personally I only do two charities. One is a small playgroup which I charge for. The other is that I volunteered as treasurer of a local church PCC and this takes up a lot of time. This I will need to re-consider as I simply don't have the time of late.

    The only piece of advice I can offer is that if you are going to not do it to let them know ASAP so they can find an alternative. Or maybe you can suggest an alternative?

  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
    Thanks all.

    I have a meeting with the new treasurer soon, so I need to get my thoughts straight before I do.

    I will double check the precise definition of independent (i.e. can my employee do the BK for me and I retain the exam). Either way I can't do both anyway as if I'm doing the IE, I would have to give the bookkeeping to someone else, and the current arrangement is it's for free, and that would leave me out of pocket. I don't mind giving my time away for free if I choose to, but the business isn't in a position to be making a loss on jobs.

    This is also a playgroup and not close to my ex-partner's heart as far as I'm aware. They were my client originally just for IE and he took them over 2 years ago.

    Oh the joys of restructuring!! :lol:
  • burg
    burg Registered, Moderator Posts: 1,441 mod
    Help is here:-

    Scroll down to question C3 and look at the 'in more detail' answer.

    Basically it is you who is performing the IE not the firm. You cannot review your own work however you could review that of one of your bookkeepers.

    They are not involved in the day to day running of the charity just keeping the books. Obviously it isn't ideal but is sufficient as far as I can see.

  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
    Thanks for looking it up for me Ian :)

    I just need to decide whether I want to pay one of my bookkeepers to do it, given that I'll likely make a loss overall... The capitalist businesswoman in me says no. The hippy and soft touch in me says yes.

    I suppose I better look and see how much work is involved!
  • anniem
    anniem Registered Posts: 1,326 Beyond epic contributor 🧙‍♂️

    Why not have a think about finding an AAT student who is looking for some experience and set them off on the book-keeping. That would enable you to do the independent examination if you want to and give someone experience to help their qualification?

    There are always students on here looking for experience.

    Anna x
    FMAAT - AAT Licensed Member in Practice - Pewsey, Wiltshire
  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
    Thanks Anna thats a good idea. I just need to find someone who is willing to come to my office as i don't want to send client paperwork to someone i don't really know!

    I suppose I could ask my local college.
  • Paul C
    Paul C Registered Posts: 193 Dedicated contributor 🦉
    Is there much bookkeeping work? I have been a Treasurer before and always did all the accounts as part of those roles. Is it something the new Treasurer could do?
  • wildgoose1uk
    wildgoose1uk Registered Posts: 200 Dedicated contributor 🦉

    If you are going to make a loss or work for nothing for a charity then it needs to be one that you have chosen because you want to support their work. I would simply pass on the details of your ex-partner to them.

    If you ant to keep any of the work then fine but it needs to be profitable for you..... thee are thousands of charities out there who simply do not understand what it costs to do their work for them...
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