Client
Records Policy Statement
Definition of Client Records -
During the course of rendering services, we routinely examine and refer to
original client documents and records. These may include, for example, original
W-2 forms, tax depreciation schedules, accounting records (for example, the
general ledger), debt agreements, bank and broker statements, purchase and sales
contracts and other legal documents. ET Section 501 of the AICPA Code
of Professional Conduct, Interpretation 501-1, “Retention of Client
Records,” provides guidance about what constitutes client records (a copy of
this will be provided upon request). Additionally,
§473.318 Florida Statutes “Ownership of working papers” states: “all statements, records,
schedules, working papers, and memoranda made by a licensee or her or his
employee incident to, or in the course of, professional services to a client,
except the reports submitted by the licensee to the client and except for
records which are part of the client's records, shall be and remain the property
of the licensee in the absence of an express agreement between the licensee and
the client to the contrary.” When a client service engagement
is completed, original client records used by us will be returned to the client
and not retained in our files as soon as practicable. If the CPA believes that
an item needs to be retained for engagement documentation purposes, we will make
a photocopy of the original for the file. You
have an obligation to maintain your own original records and we do not assume
any responsibility to maintain them. This
is particularly important where a client submits photocopies to us; we expressly
assume you will maintain control over the original documents from which the
copies were made. Definition of Firm’s Engagement
Records – Engagement working papers and files typically consist of the
firm’s original working papers, records of staff and client communications
regarding the engagement, correspondence with clients and third parties
pertaining to the engagement, copies of the work product provided to the client,
and copies of client documents. Absent a contractual agreement with a client
(for example, in an engagement to provide expert consulting services to an
attorney where the attorney requires the CPA to turn over all working papers at
the end of the engagement) the firm’s working papers are the property of the
firm. These records may exist in electronic form such as e-mails, spreadsheets
and even databases. Additionally, the types of
records created or needed to perform an engagement vary substantially based upon
the type of service rendered and the client’s industry. Therefore, it is not
possible to formulate a single record retention policy that can be used by all
CPA firms. However, the below
represent a fair approximation of the documents we believe to be as properly
belonging to the firm and not to the client: • Annual tax return working
paper files. These files may include information furnished by the client,
engagement letters, firm-prepared working papers including checklists, tax
research information developed in resolving tax return issues and questions, and
working papers containing calculations and other data prepared in support of the
tax return. • File containing the firm’s
copy of the final returns submitted to the client for filing with the tax
authorities and a diskette or other electronic storage media containing the
electronic files used to prepare and print the final returns. • Permanent or carry-forward
file containing information that will be needed on future return preparation
engagements such as fixed asset depreciation schedules, copies of correspondence
to/from taxing authorities such as requests for rulings and responses thereto. • File containing copies of all
correspondence and information sent to and received from the client and
memoranda prepared in connection with this client. Please call us at 407-812-8490 or
send an email to
tax@ralliscpa.com
if you would like more information on either of these very important policies. |
|