Agency right to audit Company finances

[Acme Thunderer]

Was having a conversation with a fellow contractor (LtdCo) who received notification from their agency that the agency were adding clauses to their contracts that allowed the agency to audit the contractors company finances. This was being dressed up as part of the HMRC reporting requirements. I don't remember seeing anything like this in the HMRC requirements so I think it is the agency over-reacting.

My initial reaction would be to pick up the phone to IPSE legal helpline to check before politely telling the agency the terms were unacceptable and I wouldn't be signing a new contract. If an agency wants to see my accounts they can go get them from companies house. However this contractor isn't a member of IPSE and hasn't heard of a contract review either - they have now been educated. I suspect IPSE will have a new member in the morning.

Anyone else see this?

PS The Agency name will be heard at the next point after deuce in a tennis game.

[cojak]

A perfect way to see your day rate for the past X years.

[Andy Hallett]

Seems a bit excessive and I'd be amazed if it ever actually happened.

[TheFaQQer]

I suspect IPSE will have a new member in the morning.

I hope you signed up to the Member Get Member scheme and gave them your referral code

And don't forget to vote (for the right people ) when the CC elections open next week

[SueEllen]

No legal requirement to carry out an audit on the books for a small Ltd. - This could potentially cost many £1,000's - No way would I sign up to that one.

The agency wants to do the audit the agency pays for it.

Though pointing out that they can get lots of details from Companies House and removing the clause would save them money and you time would be the prudent option.

[jamesbrown]

Clearly nonsense. That said, it may (rarely) be imposed by certain clients at the outset (think governments).

[jmo21]

They certainly don't have a right to ask for this.

That doesn't mean they can't, and they don't have to engage you, even if it is for a seemingly ridiculous reason like this.