In this quarterly update, we wish to provide you with an overview of changes to your OverSuite engagement letters and introduce some valuable new content. Here’s what you need to know:
What did we review?
- Changes to the professional body regulations to understand their impact on the terms and conditions in your engagement letters
- The scopes of each policy to ensure no changes to legislation will impact these
What has changed?
Legislation
There are no changes due to legislation that directly impact your OverSuite engagement letters this quarter, July-September 2023.
New Service Schedules
The following Service Schedules are new in OverSuite.
General Support: We’ve introduced a schedule that allows you to include ongoing client support as a service line and charge a fixed rate for this service if desired.
Inheritance Tax: We now offer Inheritance Tax (IHT) planning and IHT calculation service schedules to support you in providing Inheritance Tax services.
General Updates
CGT Returns, Service Schedule:
We’ve removed the 30-day reporting deadline for completion dates before October 2021, so you will now only see the 60-day reporting threshold.
Annual Accounts & Tax Return (Trusts), Service Schedule:
We’ve expanded your responsibilities to include assisting with the Trust’s registration on the HMRC register upon request. The specifics are highlighted in the quoted text below:
Statutory Responsibilities [changes]
“We will assist with the Trust’s registration on the HMRC register and update its information upon request.”
EIS Schemes, Service Schedule:
We’ve altered the time period for which your client must follow the rules after an investment is made from 3 years to a ‘specified period’ As highlighted in the quoted text below, clients are now legally responsible for ensuring they follow these rules:
“You are legally responsible for… Ensuring that you follow the rules for the specified period after the investment is made.”
Statutory Responsibilities [changes]
“You are legally responsible for… Ensuring that you follow the rules for the specified period after the investment is made.”
Audit, Service Schedule:
The audit section has been amended to clarify that audit procedures are at the auditor’s discretion and to provide more details about the audit process. The specifics are highlighted in the quoted text below and the full paragraph visible in your Engagement Letter:
Statutory Responsibilities [changes]
“An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error… Because of the test nature and other inherent limitations of an audit, together with the inherent limitations of any accounting and internal control system, there is an unavoidable risk that even some material misstatements may remain undiscovered “
We’ve introduced additional clauses to protect both you and your client:
- You may not share the audit report with third parties without our written consent.
- We may use analytical tools during the audit and request data as needed.
- We are committed to complying with ethical requirements in accordance with professional standards.
- The form and content of our report may need to be amended based on our findings.
- Our work is not subject to the limitation of liability as stated in the terms and conditions unless a separate auditor liability limitation agreement under s532 – s538 of the Companies Act 2006 is in place.
Charity Accounts (Incorporated Friendly Societies), Scope:
We’ve added an additional clause to clarify that financial statements cannot be approved unless the client is completely satisfied that they provide a true and fair view. The specific language is highlighted in the following quoted text:
Statutory Responsibilities [changes]
“As officers, you must refrain from approving the financial statements unless you are completely satisfied that they provide a true and fair view of the society’s assets, liabilities, financial position, and profit or loss.”
Community Interest Company (Audit), Scope:
We’ve clarified the purpose of the audit and added a clause ensuring that you will inform your client of any matters that might impact your ability to review the audit independently. As emphasised in the quoted text below:
Statutory Responsibilities [changes]
“Our audit will aim to express an opinion on whether the financial statements comply with accounting standards, the Companies Act, and provide a true and fair view.”
“We commit to timely informing you of any significant facts or matters that may impact our integrity, objectivity, and independence.”
Additionally, there are further clauses for additional clarification around what will and won’t be done in the “Your Responsibilities” section.
Your Responsibilities [changes]
“We may need to address certain other matters in our report, such as disclosing director’s remuneration details as required by the Companies Act 2006.”
“Our audit work serves to inform the members according to legal requirements, and we accept responsibility solely to the company and its members. Your responsibilities as directors remain crucial.”
“For over 30 years Valerie Steward has worked with accountancy practices, helping them to develop their businesses and remain compliant. She has authored and co-authored a number of technical guides, work programmes on audit and anti-money laundering and practical aids such as engagement letters as well as publications on practice management and the not for profit sector.”
Valerie StewardAt The Forefront Of Compliance For Over 30 Years
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