ICAEW.com works better with JavaScript enabled.


Change of professional appointment - outgoing accountant

Helpsheets and support

Published: 20 Dec 2018 Updated: 19 Oct 2021 Update History

Exclusive content
Access to our exclusive resources is for specific groups of students, users and members.

Technical helpsheet issued to help ICAEW members understand their responsibilities when existing clients wish to transfer their relationship to a new accountant.


This helpsheet has been issued by ICAEW’s Ethics Advisory Service to help ICAEW members understand their responsibilities when existing clients wish to transfer their relationship to a new accountant.

Clients have the right to choose their accountants and to change their accountants if they so desire. Section 320 of the ICAEW Code of Ethics deals with changes in professional appointment and the specific procedures to be followed by both the prospective and existing accountants.

Members may also wish to refer to the following related helpsheets and guidance:

Responding to a professional enquiry

Where you receive a letter of professional enquiry, you should:

  • Obtain the client’s permission (preferably in writing) to communicate with the proposed new accountant;
  • Satisfy yourself regarding disclosure issues before passing over any confidential information to the prospective accountant;
  • Respond promptly;
  • If there are no matters of which the prospective accountant should be aware this should be stated in the response; and
  • If there are matters of which the prospective accountant should be aware, the details should be provided – it is not sufficient to state unspecified matters exist.

Content of your response

In providing your response, paragraph R320.7 of the ICAEW Code of Ethics requires you to comply with relevant laws and regulations governing the request and provide any information honestly and unambiguously.

Counsel has advised that as far as UK law is concerned, an existing accountant who communicates to a proposed accountant matters damaging to the client or to any individuals concerned with the client’s business will have a strong measure of protection were any action for defamation to be brought against the existing accountant. This means that the existing accountant shall not be liable to pay damages for defamatory statements even if they turn out to be untrue, provided that they are made without malice. There is little likelihood of an existing accountant being held to have acted maliciously provided that:

  • Only what is sincerely believed to be true is stated; and
  • Reckless imputations are not made against a client or connected individuals for which there can be no reason to believe they are true.

Professional enquiry - common issues

Professional clearance

Professional enquiry is often referred to as ‘professional clearance’. This is a misnomer as you do not have the authority to give or withhold ‘clearance’ or ‘permission’ to act. The decision whether or not to accept appointment is the responsibility of the prospective accountant.

In the event that a prospective accountant seeks ‘permission’ or ‘clearance’ to act, you should not use such terminology in your response.

Client consent

You usually require the consent of your client in order to respond to a professional enquiry. Such consent is required (preferably in writing) in order to adhere to the fundamental principle of confidentiality outlined in section 114 of the ICAEW Code of Ethics.

If your client refuses consent to respond to a professional enquiry received from a prospective accountant, you must not provide a substantive response (although special considerations apply in the case of audit and review engagements – see Special case – audit or review appointments). You should however write to the prospective accountant informing them that consent to respond has been refused.

Outstanding fees

Outstanding fees are not a reason for failing to respond to a professional enquiry.

You must (usually having obtained the consent of your client) respond to a professional enquiry even where fees are outstanding. You are however entitled to raise the matter of outstanding fees in your response.

You may, in certain circumstances, have the right to withhold records (see Transfer of information and provision of information section), however this does not give you the right to refuse to respond to a professional enquiry.

Anti-money laundering and terrorism

Paragraph R320.7B of the ICAEW Code of Ethics makes clear that you must not disclose whether you have made one or more suspicious activity reports relating to money laundering or terrorism or make other disclosures that could amount to tipping off.

If such a question is included in a professional enquiry received from a prospective accountant, this should not be responded to, either positively or negatively in any reply provided.

You are not however relieved of your obligations to bring to the attention of the prospective accountant any matters which they ought to know, and in line with paragraph R320.7 of the code, should explain such matters honestly and unambiguously. It would usually therefore be appropriate to include a factual reference to any irregularities perhaps identifying a specific unresolved matter or an item yet to be included on a tax return for example. An example of this could be:

The client informed us of rental income they have been receiving since [date – if known]. However, they have yet to disclose this to HMRC. Full disclosure needs to be made for all periods affected.

Members may discuss specific circumstances on an anonymous basis with the ICAEW Ethics Advisory Service.

New accountant acting without making a professional enquiry

Anyone can bring any issue to the attention of the new accountant’s professional body. However, you should consider whether the lapse is the fault of the new accountant or the client before registering a complaint.

You should consider writing to the new accountant asking why no professional enquiry was made especially if there are facts that you consider should be brought to the attention of the new accountant, although such facts cannot be communicated unless permission has been obtained from the client.

Special case – audit or review appointments

In the case of audit or review appointments, where you have withdrawn from the professional relationship as a result of the client’s non-compliance with laws and regulations, you must provide all relevant facts and information concerning the identified or suspected non-compliance to the prospective accountant, even if the client refuses to give them permission for you to respond to the professional enquiry (paragraph R320.8 of the ICAEW Code of Ethics). You may therefore find wording along the following lines useful in such a reply:

Our former client has not given us authority to respond to your professional enquiry. Our response is therefore limited to our obligation under the ICAEW Code of Ethics to disclose to you details of non-compliance with laws and regulations connected with our ceasing to act.

 In the case of a change in statutory audit appointment, if you are currently in office, you are under no obligation to resign. It may therefore be necessary for the client company to implement the relevant Companies Act procedures to progress the new appointment if you elect not to resign from your appointment.

On ceasing to hold office, you must consider your notification requirements under the Companies Act 2006 and may need to remind the audit client of their obligations too. Further guidance can be found in the helpsheets Auditor resignation – Auditor responsibilities and Auditor resignation – Company responsibilities respectively.

Transfer of records and provision of information

It is common practice to combine a professional enquiry with a request for transfer of records and provision of information.

Paragraph R320.7C of the ICAEW Code of Ethics requires you to deal promptly with any reasonable request for the transfer of records. You may however have the right of a particular lien where there are outstanding fees, further guidance on which can be found in the Exercising liens helpsheet.

The purpose of exercising a lien is to assist prompt settlement from a slow client and not to exact payment from a client who has a genuine dispute over fees. You are required by paragraph R330.11 of the code to take reasonable and prompt steps to resolve any dispute relating to the amount of that fee.

Where a prospective accountant asks you for information as to the client’s affairs, you are obliged by paragraph R320.7D to provide such information if lack thereof might prejudice the client’s interests and the client is unable to provide the information themselves. There is no obligation to provide information that has already been provided to the client and is therefore available from them. Although the contents of a file may include documents owned by you rather than the client (see Documents and records: ownership, lien and rights of access), information from such documents may still need to be provided.

You shall not normally charge for such records and information unless there is good reason to the contrary. Examples of such reasons include

  • Where a significant amount of work is involved. This may be the case where information is requested going back a number of years and requires you to obtain files from archives.
  • Where the incoming accountant requests information as a matter of convenience but the client has previously been provided with the information. This might be the case where copies of previous years’ tax returns are being requested.

Special case – audit appointments

When there is a change in audit appointment, the registered auditor ceasing to hold office (the ‘predecessor’) is required to provide access to relevant information where the newly appointed registered auditor (the ‘successor’) makes a written request for such access. Guidance is available in AAF 01/08 Access to information by successor auditors.

Other disengagement considerations

Whenever you disengages from a client it is good practice to complete a disengagement checklist and send a disengagement letter to the outgoing client. Further guidance can be found in the helpsheets Disengagement checklist and Disengagement letters.

If in doubt seek advice

ICAEW members, affiliates, ICAEW students and staff in eligible firms with member firm access can discuss their specific situation with the Technical Advisory Service on +44 (0)1908 248 250 or via webchat.

Terms and conditions

© ICAEW 2024  All rights reserved.

ICAEW cannot accept responsibility for any person acting or refraining to act as a result of any material contained in this helpsheet. This helpsheet is designed to alert members to an important issue of general application. It is not intended to be a definitive statement covering all aspects but is a brief comment on a specific point.

ICAEW members have permission to use and reproduce this helpsheet on the following conditions:

  • This permission is strictly limited to ICAEW members only who are using the helpsheet for guidance only.
  • The helpsheet is to be reproduced for personal, non-commercial use only and is not for re-distribution.

For further details members are invited to telephone the Technical Advisory Service T +44 (0)1908 248250. The Technical Advisory Service comprises the technical enquiries, ethics advice, anti-money laundering and fraud helplines. For further details visit icaew.com/tas.

Download this helpsheet

PDF (204kb)

Access a PDF version of this helpsheet to print or save.

Changelog Anchor
  • Update History
    20 Dec 2018 (11: 00 AM GMT)
    First published
    19 Oct 2021 (10: 10 AM BST)
    Changelog created, helpsheet converted to new template
    19 Oct 2021 (10: 11 AM BST)
    Added an example of how you might reply if you have made a SAR – example was for undeclared rental income.