1. APPLICABLE LAW
1.1 Our engagement letter shall be governed by, and construed in accordance with, English law. The Courts of England shall have exclusive jurisdiction in relation to any claim, dispute or difference concerning the engagement letter (including the firm's terms of business) and any matter arising from it. Each party irrevocably waives any right it may have to object to an action being brought in those Courts, to claim that the action has been brought in an inconvenient forum, or to claim that those Courts do not have jurisdiction.
1.2 Persons who are not party to this agreement shall have no rights under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this agreement. This clause does not affect any right or remedy of any person which exists or is available otherwise than pursuant to that Act.
1.3 The advice we give you is for your sole use and is confidential to you and will not constitute advice for any third party to whom you may communicate it. We will accept no responsibility to third parties for any aspect of our professional services or work that is made available to them.
2. QUALITY OF SERVICE
2.1 We aim to provide you with a fully satisfactory service and Mr Harris will seek to ensure that this is so. We undertake to look into any complaint carefully and promptly and to do all we can to explain the position to you. If we do not answer your complaint to your satisfaction you may of course take up the matter with the Institute of Chartered Accountants in England and Wales (ICAEW) by whom we are regulated.
2.2 For consumer agreements, should we be unable to resolve your complaint you may also be able to refer your complaint to an alternative dispute resolution (ADR) provider to try and reach a resolution. We will provide details of an ADR provider if we cannot resolve your complaint using our internal procedures. This is in addition to your ability to complain to ICAEW.
2.3 We are not licensed or authorised for the reserved legal activity of non-contentious probate. Consequently, any work we do for you on closely aligned activities, such as estate administration or inheritance tax advice, will not be covered by the ICAEW Probate Compensation Scheme, this service will not be covered by legal personal privilege and you will not have access to the Legal Ombudsman.
3. INVESTMENT ADVICE – EXEMPT REGULATED ACTIVITIES
3.1 Although we are not authorised by the Financial Conduct Authority to conduct Investment Business, we are licensed by the ICAEW to provide certain limited investment services where these are complementary to, or arise out of, the professional services we are providing to you.
3.2 Such assistance may include the following:
• advising you on investments generally, but not recommending a particular investment or type of investment;
• referring you to a Permitted Third Party (PTP) an independent firm authorised by the FCA) and assisting you and the authorised third party during the course of any advice given by that party. This may include comment on, or explanation of, the advice received (but we will not make alternative recommendations). The PTP will issue you with his own terms and conditions letter, will be remunerated separately for his services and will take full responsibility for compliance with the requirements of the Financial Services and Markets Act 2000. The firm may receive commission from such an introduction, in which case you will be fully informed of the expected size and nature of such commission at the time of the introduction.
• advising on the sale of a contractually based investment other than disposing of any rights or interests which you may have as a member of a personal pension scheme;
• advising and assisting you in transactions concerning shares or other securities not quoted on a recognised exchange;
• managing investments or acting as trustee (or donee of a power of attorney) where decisions to invest are taken on the advice of an authorised person;
• where appropriate, advise you on activities appropriate to an academy trust or a charity.
3.3 We may also, on the understanding that the shares or other securities of the company are not publicly traded:
• advise the company, existing or prospective shareholders in relation to exercising rights, taking benefits or share options valuation and methods;
• arrange any agreements in connection with the issue, sale or transfer of the company’s shares or other securities;
• arrange for the issue of the new shares; and
• act as the addressee to receive confirmation of acceptance of offer documents etc.
3.4 To enable us to provide you with a proper service, there may be occasions when we will need to contact you without your express permission concerning investment business matters. For example, it may be in your interests to sell a particular investment and we would wish to inform you of this. We may therefore contact you in such circumstances but would only do so in our normal office hours. We shall of course comply with any restrictions you may wish to impose which you notify to us in writing.
4.1 Our fees are computed on the basis of the time spent on your affairs by the partners and staff, and on the levels of skill, urgency and responsibility involved. Unless otherwise agreed, our fees will be charged separately for each of the main classes of work described above, and will be billed at appropriate intervals during the year and will be due on presentation. We intend to operate a credit limit on all work we carry out for you, and to stop any work when that credit limit it exceeded. Until further notice, your credit limit is set out in the menu of services in your letter of engagement. In the unlikely event of non payment of our invoices, we reserve the right to recover the sums due to us through legal proceedings.
4.2 It is our normal practice to request that clients make arrangements to pay a proportion of their fee on a monthly standing order. These standing orders will be applied to fees arising from work agreed in the letter of engagement for the current and ensuing years. Once we have been able to assess the amount of work and time involved we expect you to agree to pay an amount to us on a regular basis.
4.3 Invoices are submitted by Harris & Co for the work that is performed. Payment is due to Harris & Co 14 days from the date of the invoice. Harris & Co has the statutory right to charge interest under the Late Payment of Commercial Debts (Interest) Act 1998 if the invoice is not paid according to the agreed credit terms. The rate of interest is the Bank of England’s base rate plus 8%. In addition the Act provides the right to charge reasonable debt-recovery costs.
4.4 If your invoices are not paid by the due date, we reserve the right ti cease work on your affairs. In this instance, any subsequent interest or penalties you incur from the Government agencies are your responsibility.
4.5 Harris & Co follows a formal credit control procedure and reserves the right to stop work without notice on any arrangement on which we have instructions from you where there are unpaid invoices. We are entitled to keep all your papers and documents while there are unpaid invoices.
4.6 Under Section 11 of the Fraud Act 2006, it is a criminal offence to engage our services and then not to pay for them. The offence is punishable by either a maximum of 5 years imprisonment or a fine (or both).
4.7 Harris & Co will archive documents relating to any work carried out under the letter of engagement for 7 years from the date of our final bill to you for the relevant work, after which time the file will be destroyed. We may be obliged to make a small charge to you if you request that we retrieve documents from archiving.
4.8 In the event that a company which enters into an engagement with us does not pay our fees, any person acting as either a director, company secretary, shadow director or shareholder at any time whatsoever will be jointly and severally liable for our fees and any interest accrued thereon.
4.9 Our VAT number is 103 140 876. All costs quoted exclude VAT. Consequently, VAT will be charged on top of the costs set out in our agreement at the rates ruling at the time.
5. LIMITATION OF LIABILITY
5.1 We will perform the engagement with reasonable skill and care. The total aggregate liability to the Company and the Board of Directors, as a body, of whatever nature, whether in contract, tort or otherwise, of Harris & Co for any losses whatsoever and howsoever caused arising from or in any way connected with this engagement (apart from audit work) shall not exceed 20 times our fee in total charged for the year in which the claim arose. In the case of academies, a cap of £1 million on the reporting accountant’s liability, as recommended by the Education Funding Agency, shall exist per academy in each trust.5.2 It is a condition of our undertaking to perform the non-audit services set out in this letter that, in the rare event of any future possible litigation between us, you agree to a limit of 20 times our fee in total charged for the year in which the claim arose on any damages or compensation that may be awarded to you. The limit shall not apply in respect of death or personal injury caused by our negligence. Our fees are computed on the basis that this limitation is reasonable, and is the maximum limit to our liability. Should you wish to negotiate a higher limit to our aggregate liability to you, then we may need to revise our fees to reflect the increase in risk to us.
5.3 We have a lien on all documents and records retained by us on your behalf, until all fees have been paid in respect of all work we carry out on your behalf.
6. RETENTION OF AND ACCESS TO RECORDS
6.1 During the course of our work we will collect information from you and others acting on your behalf and will return any original documents to you following the completion of our work. You should retain them for 5 years from the 31 January following the end of the tax year. This period may be extended if HM Revenue and Customs enquire into your tax return.
6.2 Whilst certain documents may legally belong to you, we intend to destroy correspondence and other papers that we store which are more than seven years old, other than documents which we consider to be of continuing significance. If you require retention of any document you must notify us of that fact in writing.
7. ELECTRONIC COMMUNICATION
7.1 Internet communications are capable of data corruption and therefore we do not accept any responsibility for changes made to such communications after their despatch. It may therefore be inappropriate to rely on advice contained in an email without obtaining written confirmation of it. We do not accept responsibility for any errors or problems that may arise through the use of internet communication and all risks connected with sending commercially sensitive information relating to your business are borne by you. If you do not agree to accept this risk, you should notify us in writing that email is not an acceptable means of communication.
7.2 It is the responsibility of the recipient to carry out a virus check on any attachments received.
8. DATA PROTECTION
8.1 To enable us to discharge the services agreed in our engagement letter, comply with related legal and regulatory obligations and for other related purposes including updating and enhancing client records and analysis for management purposes, as a data controller, we may obtain, use, process and disclose personal data about you, your business/company/partnership, its shareholders/members/officers and employees, as described in our privacy notice. We confirm when processing data on your behalf that we will comply with the provisions of all relevant data protection legislation and regulation.
8.2 You are also an independent data controller responsible for complying with data protection legislation and regulation in respect of the personal data you process and, accordingly where you disclose personal data to us you confirm that such disclosure is fair and lawful and otherwise does not contravene relevant requirements. Nothing within our engagement letter relieves you as a data controller of your own direct responsibilities and liabilities under data protection legislation and regulation.
8.3 Our privacy notice, which can be found on our website at https://www.harrisandco.biz/privacy-policy, explains how we process data in respect of the various services that we provide.
8.4 As part of our ongoing commitment to providing a quality service, our files are periodically reviewed by an independent regulatory or quality control body. These reviewers are highly experienced and professional people and, of course, are bound by the same rules for confidentiality as us.
Processing of customer personal data
8.5 Data protection legislation and regulation places obligations on you as a data controller where we act as a data processor to undertake the processing of personal data on your behalf, for instance where we operate a payroll service for you. We therefore confirm that we will at all times take appropriate measures to comply with relevant requirements when processing data on your behalf. In particular we confirm that we have adequate security measures in place and that we will comply with any obligations equivalent to those placed on you as a data controller. Terms relating to our responsibilities as a data processor are set out in paragraphs 8.6 to 8.9 below.
8.6 In respect of the client personal data, unless otherwise required by applicable laws or other regulatory requirements, we shall:
8.6.1 Process the client personal data only in accordance with your lawful written instructions, in order to provide you with the services pursuant to our engagement with you and in accordance with applicable data protection legislation;
8.6.2 Disclose and transfer the client personal data to members of our firm’s network, our regulatory bodies or other third parties (for example, our professional advisors or service providers) as and to the extent necessary in order to provide you with the services pursuant to our engagement with you in relation to those services;
8.6.3 Disclose the client personal data to courts, government agencies and other third parties as and to the extent required by law;
8.6.4 Maintain commercially reasonable and appropriate security measures, including administrative, physical and technical safeguards, to protect against unauthorised or unlawful processing of any client personal data and against accidental loss or destruction of, or damage to, such client personal data.
8.6.5 Maintain written records of our processing activities performed on your behalf which shall include:
i. the categories of processing activities performed;
ii. details of any cross-border data transfers outside of the United Kingdom; and
iii. a general description of security measures implemented in respect of the client personal data;
8.6.6 Return or delete all the client personal data upon the termination of the engagement with you pursuant to which we agreed to provide the services;
8.6.7 Ensure that only those personnel who need to have access to the client personal data are granted access to it and that all of the personnel authorised to process the client personal data are bound by a duty of confidentiality;
8.6.8 Notify you if we appoint a sub-processor (but only if you have given us your prior written consent, such consent not to be reasonably withheld or delayed) and ensure any agreement entered into with the relevant sub-processor includes similar terms as the terms set out in this section;
8.6.9 Where we transfer the client personal data to a country or territory outside the EEA to do so in accordance with data protection legislation;
8.6.10 Notify you promptly if:
• We receive a request, complaint or any adverse correspondence from or on behalf of a relevant data subject, to exercise their data subject rights under the data protection legislation or in respect of the client personal data; or• We are served with an information or assessment notice, or receive any other material communication in respect of our processing of the client personal data from a supervisory body (for example, the Information Commissioner’s Office);8.6.11 Notify you, without undue delay, in the event that we reasonably believe that there has been a personal data breach in respect of the client personal data; and8.6.12 At your cost and upon receipt of your prior written notice, allow you, on an annual basis and/or in the event that we notify you of personal data breach in respect of the client personal data, reasonable access to the relevant records, files, computer or other communication systems, for the purposes of reviewing our compliance with the data protection laws.
8.7 Without prejudice to the generality of clause 8.1, you will ensure that you have all necessary appropriate consents and notices in place to enable the lawful transfer of the client personal data to us.
8.8 Should you require any further details regarding our treatment of personal data, please contact our data controller.
8.9 The following details are also required by Article 28(3) of the GDPR:
8.9 1 Subject matter and duration of the processing of client personal data
The subject matter and duration of the processing of the client personal data are set out in the engagement letter between us and, where relevant, relate to provision of payroll services.
8.9 2 The nature and purpose of the processing of client personal data
The processing of client personal data is in order to calculate payroll and deductions and arrange payments to HMRC and the employees of your business and its subsidiaries if relevant.
8.9 3 The types of client personal data to be processed
Personal Data:• Full name• Date of birth• Home address• National Insurance number• Tax code• Salary• Benefits in kind
8.9 4 The categories of data subject to whom the client personal data relates
The client personal data relates to employees your business and its subsidiaries if relevant.
9.1 Where you give us confidential information, we confirm that we shall at all times keep it confidential, other than as required by law, by our insurers, or as provided for in regulatory (including external peer reviews), ethical or other professional statements relevant to our engagement. This will apply during and after this engagement.
9.2 We may subcontract our work to other prefessionals within the sector. Any subcontractors are also bound by our client confidentiality terms.
10. PROFESSIONAL RULES AND PRACTICE GUIDELINES
10.1 We will observe and act in accordance with the bye-laws, regulations and Code of Ethics of the ICAEW and accept instructions to act for you on this basis. In particular you give us the authority to correct errors made by HMRC where we become aware of them. We will not be liable for any loss, damage or cost arising from our compliance with statutory or regulatory obligations. You can see copies of these requirements in our offices. The requirements are also available on the internet at www.icaew.com/regulations.
10.2 We confirm that we are Statutory Auditors eligible to conduct audits under the Companies Act 2006, to conduct audits under the Companies Act 2006 (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008), to conduct audits under the Pensions Act 1995. When conducting audit work we are required to comply with the Revised Ethical Standard 2016 and the International Standards on Auditing (UK) which can be accessed on the internet at https://www.frc.org.uk/Our-Work/Audit-and-Actuarial-Regulation/Audit-and-assurance/Standards-and-guidance.aspx
11. CONFLICTS OF INTEREST
11.1 We reserve the right during our engagement with you to deliver services to other clients whose interests might compete with yours or are or may be adverse to yours. Subject to our confidentiality clause, we confirm that we will notify you immediately should we become aware of any conflict of interest involving us and affecting the business.
11.2 If a conflict of interest should arise, either between two or more of our clients, or in the provision of multiple services to a single client, we will take such steps as are necessary to deal with the conflict. In resolving the conflict, we would be guided by the Code of Ethics of The Institute of Chartered Accountants in England and Wales which can be viewed on the internet at the address above [in part 3, sub-section 310].
12. PROVISION OF SERVICES REGULATIONS 2009
12.1 We are registered to carry on audit work in the UK and Ireland by the Institute of Chartered Accountants in England and Wales. Details of our audit registration can be viewed at www.auditregister.org.uk for the UK and for Ireland at www.cro.ie/auditors under reference number C008613035.
12.2 Our professional indemnity insurer is AXA PLC, 5 Old Broad Street, London, EC2N 1AD and the policy number is ABCP1 4101105. The territorial coverage is worldwide excluding professional business carried out from an office in the United States of America or Canada and excludes any action for a claim brought in any court in the United States or Canada.
13. COMMISSIONS OR OTHER BENEFITS
13.1 In some circumstances, commissions or other benefits may become payable to us or one of our associates in respect of transactions we or such associates arrange for you. If this happens we will notify you in writing of the amount and terms of payment. The nature of the engagement and professional judgement would determine the frequency and detail required to ensure compliance with our Code of Ethics. The fees that would be otherwise payable by you will be abated by such amounts. When we reduce the fees that we would otherwise charge by the amount of commission retained, we will apply the HMRC concession which allows VAT to be calculated on the net fee after deduction of the commission. You consent to such commission or other benefits being retained by us or, as the case may be, by our associates, without our, or their, being liable to account to you for any such amounts.
13.2 If in the future, abnormally large commissions are received which were not envisaged when the engagement letter was signed, we will obtain specific consent to the retention of those commissions.
14. CLIENT IDENTIFICATION
14.1 In common with all accountancy and legal practices, the firm is required by law to:
• Maintain identification procedures for clients and beneficial owners of clients;
• Maintain records of identification evidence and the work undertaken for the client; and
• Report, in accordance with the relevant legislation and regulations.
14.2 The provision of accountancy and tax services is a business in the regulated sector under the Proceeds of Crime Act 2002 and, as such, partners and staff in accountancy and tax firms have to comply with this legislation which includes provisions that may require us to make a money laundering disclosure in relation to information we obtain as part of our normal accountancy and tax work. It is not our practice to inform you when such a disclosure is made or the reasons for it because of the restrictions imposed by the ‘tipping off’ provisions of the legislation.
14.3 We may use electronic checks as part of our identification procedures. We confirm that these electronic checks are not credit checks.
15. ONLINE SUBMISSION
15.1 HM Revenue & Customs are moving to a policy of only accepting online submission of accounts, tax returns, PAYE, CIS and VAT returns. For most of these online submissions, Harris & Co are reliant upon our software provider, Iris Software Group Limited, as well as HM Revenue & Customs’ software, to ensure that the returns are compatible with HM Revenue & Customs’ requirements. Harris & Co accept no liability for penalties incurred for late submission of returns due to the failure of either HM Revenue & Customs’ or Iris’s software.
16.1 Our employees have the right to work in a safe environment without threats or harassment from our clients. If you threaten, abuse or harass our employees we reserve the right to immediately cease work on your affairs and to charge you for the work that we have carried out so far. We may also levy a charge to handover information to your new accountants.
17. TIMING OF OUR SERVICES
17.1 If you provide us with all information and explanations on a timely basis in accordance with our requirements, we will plan to undertake the work within a reasonable period of time in order to meet any regulatory deadlines. However, failure to complete our services prior to such regulatory deadlines would not, of itself, mean that we are liable for any penalty or additional costs arising.
18. TRADING STYLE
18.1 Harris & Co is the trading style of Harris & Co (Accountants) Limited, company number 04512161.
19. USE OF OUR NAME IN STATEMENTS OR DOCUMENTS ISSUED BY YOU
19.1 You are not permitted to use our name in any statement or document that you may issue unless our prior written consent has been obtained. The only exception to this restriction would be statements or documents that in accordance with applicable law are to be made public.
19.2 The copyright in any document prepared by us belongs to us in entirety unless the law specifically provides otherwise.
20.1 If there is a conflict between an engagement letter schedule and these terms of business then the engagement letter takes precedence.
20.2 We will provide services as outlined in this letter with reasonable care and skill. However, to the fullest extent permitted by law, we will not be responsible for any losses, penalties, surcharges, interest or additional tax liabilities where you or others supply incorrect or incomplete information, or fail to supply any appropriate information or where you fail to act on our advice or respond promptly to communications from us or the tax authorities.
20.3 You will not hold us, the owners of this firm and any staff employed by the firm, responsible, to the fullest extent permitted by law, for any loss suffered by you arising from any misrepresentation (intentional or unintentional) supplied to us orally or in writing in connection with this agreement. You have agreed that you will not bring any claim in connection with services we provide to you against any of the principals or employees personally.
20.4 Our work is not, unless there is a legal or regulatory requirement, to be made available to third parties without our written permission and we will accept no responsibility to third parties for any aspect of our professional services or work that is made available to them.
20.5 If any provision of this engagement letter or terms of business or its application is held to be invalid, illegal or unenforceable in any respect, the validity, legality or enforceability of any other provision and its application shall not in any way be affected or impaired.
20.6 Advice we give you orally should not be relied upon unless we confirm it in writing. We endeavour to record all advice on important matters in writing. However, if you particularly wish to rely upon oral advice we give you during a telephone conversation or a meeting, you must ask for the advice to be confirmed in writing.
20.7 We will not accept responsibility if you act on advice previously given by us without first confirming with us that the advice is still valid in the light of any change in the law or your circumstances. We will accept no liability for losses arising from changes in the law or the interpretation thereof that occur after the date on which the advice is given.
20.8 Unless specifically instructed and agreed in advance we will not assist with the implementation of our advice.
21. PROVISION OF CLOUD-BASED SERVICES
21.1 Where the firm provides accounting software in the Cloud, this will be provided by a third party (the ‘Cloud Supplier’). The third party has signed a confidentiality agreement with the firm to ensure compliance with the relevant clauses in the firm’s standard terms of business above, in particular, Fees and payment terms (4), Electronic communication (7), and Data protection (8).
21.2 The service provided by the Cloud Supplier will be a discrete web based hosted facility, and you agree that access will also be provided to the firm and the third party.
21.3 The firm cannot be held liable for any interruption of service provided by the Cloud Supplier. However, we will liaise with them regarding the resumption of a normal service as soon as possible.
22. TERMINATION OF OUR AGREEMENT
22.1 Either party to these terms of engagement may terminate the agreement by giving not less than 21 days notice in writing to the other party. We may, however, terminate our agreement immediately where you fail to cooperate with us, or we have reason to believe that you have provided us or HMRC with misleading information. Termination will be without prejudice to any rights that may have accrued to either of us prior to termination.
22.2 Should our contract be terminated, we will endeavour to agree with you the arrangements for the completion of work in progress at that time. We may, however, be required for legal or regulatory reasons to cease work immediately. In that event, we shall not be required to carry out further work and shall not be responsible or liable for any consequences arising from termination.
Updated March 2021