Precedent client engagement letter

 

Thank you for your instructions to attend to the accounting and taxation requirements for your family members and corporate and trustee entities (if applicable).  A list of the individuals and entities for whom we are to act (the Group) is set out in the accompanying Schedule of Clients and our comments below are directed to all those persons.  

This letter sets out our terms of engagement and the scope of the work to be performed by us within that engagement, and supersedes any previous engagement letter provided by us.  Please read it carefully and if you have any queries or wish to discuss any aspect, do not hesitate to contact us.

The provision of tax agent services is governed by the Tax Agent Services Act 2009 (TASA) and the accompanying regulations.  Registered tax practitioners must comply with the requirements of the TASA, which includes a set of ethical and professional standards known as the ‘Code of Professional Conduct’.  General information about the obligations and responsibilities of tax practitioners to their clients is set out in the attached document, Rights and Obligations of the Parties under the Taxation Laws.

The Tax Practitioners Board (TPB) is responsible for the registration and regulation of tax practitioners and for ensuring their compliance with the TASA.  As part of this role, the TPB maintains a register that enables the public to ensure they are engaging the services of a registered tax practitioner.  The register also provides details of suspended and deregistered tax practitioners. 

To check the details of the tax practitioner responsible for your tax affairs, search the TPB Register at www.tpb.gov.au/public-register using either of the following details:

1. Ultimate SK PTY LTD with registration number 25518297
2. Slobodan Serval with registration number 25498933

Taxpayers who engage registered tax agents also have rights and obligations under the taxation laws, including a safe harbour from certain penalties imposed by the Australian Taxation Office (ATO).  To qualify for safe harbour protection, taxpayers must provide their registered tax agent with “all relevant taxation information” to enable accurate statements to be provided to the ATO.  This requirement may be important to both parties in identifying and understanding the purpose and scope of the engagement and may also affect other matters discussed below.  You will find a further discussion on the safe harbour protections in the attached document, Rights and Obligations of the Parties under the Taxation Laws.

We may become ethically required to disclose non-compliance with laws or regulations to a regulatory authority if the non-compliance has a material effect on the work that we perform under this engagement.

If the terms of our engagement are acceptable, we ask that all persons sign the enclosed copy of this engagement letter in the places indicated and return it to our office. 

Please note that we are unable to perform any work for you until we receive the signed copy.

 

1.     Purpose and scope of engagement

Our engagement is to attend to the following matters for the Group, as applicable:

• Prepare and lodge Business Activity Statements (BASs);
• Prepare the annual financial statements;
• Prepare and lodge annual income tax returns;
• Prepare and lodge annual FBT returns;
• Lodge Single Touch Payroll reports; and
• Prepare and lodge annual returns for your superannuation fund.

Unless otherwise agreed, we will prepare the above returns and statements on an ongoing basis, in relation to the period following that for which the returns and statements have most recently been finalised, and for each subsequent period.

Each member of the Group engages us on the terms set out in this letter and is bound by those terms.  Those persons are jointly and severally liable to pay our accounts, regardless of which Group member those accounts are addressed to, and regardless of which Group member received the benefit of the work performed.

If we are asked to act for a new or additional member of your family group, we may forward to you an updated Schedule of Clients which each existing Group member agrees will apply in place of any previous Schedule of Clients.  We may also require the new Group member to sign an acknowledgement of these terms of engagement.

Our services will be provided to you on a fee for service basis.

This letter relates only to the abovementioned services and details the basis and terms of this engagement.  Unless otherwise agreed, our engagement will be limited to the matters described in this letter.  Work that is performed or disbursements that are incurred which are outside the scope of this letter will be the subject of additional charge.

Our engagement commences as soon as you return this engagement letter and it has been signed by you.  In addition to any other rights you might have, you can terminate this engagement at any time by telling us in writing.  We also reserve the right to do so by providing you with 14 days’ written notice.

If either you or we terminate this engagement, the provisions of clause 2.5 (in relation to ownership of documents) will apply.    

2.     Basis of engagement

Our engagement is to assist with the preparation of the financial accounts and the preparation and lodgment of the taxation returns for your Group.  This includes the non-trading individual members of your family (Individuals), as well as your trading entities (including individuals), corporate entities, partnerships, trustees and superannuation entities (Entities).

2.1   Accounting and record-keeping

In undertaking this engagement, you must generally ensure the following:

• The bookkeeping for all Entities is maintained on a regular basis. In fact, we recommend the bookkeeping and record-keeping tasks be attended to each week.
• Reconciliations for the bank accounts, debtors and creditors are performed at the end of each month for each of the Entities.
• A stocktake will be performed during the last weekend in June for each entity that deals in trading stock.
• It is expected that the trial balance of each of the Entities will be completed no later than 31st December each year.

In respect of the personal tax returns for Individuals, we require that all relevant information be collated and forwarded to our office by 31st March each year.  We shall detail more specific requirements in respect of the Individual tax returns later in this letter.

2.2   Taxation services

In engaging us to provide taxation services, it is important for you to understand the following:

• You are responsible for the accuracy and completeness of the particulars and information provided to us by you.
• Any advice we provide is only an opinion based on our knowledge of your particular circumstances.
• You have obligations under the self-assessment regime to keep full and proper records in order to facilitate the preparation of accurate returns.
• We cannot provide taxation services if we find that information on which those services are to be based contain false or misleading information, or omit material information, and you are not prepared to appropriately amend that information.

Before we lodge any returns, statements or other documents on your behalf, we will forward them to you or the relevant taxpayer in the Group for approval.  We will endeavour to ensure that the returns are lodged by the due dates and will advise you at the beginning of the financial year when documentation should be provided to us.  If you are late in providing information, we will do our best to meet the time limits, but we will not be responsible for any late lodgment penalties or interest charges you may incur.

2.3   Compilation of financial statements

By engaging us to compile financial statements, you acknowledge that:

• the reliability, accuracy and completeness of the accounting records are your responsibility; and
• that you have disclosed to us all material and relevant information.

You and your employees are responsible for the maintenance of the accounting systems and internal controls for all the Entities.  That includes the keeping and maintenance of all required books of account.  Our firm cannot be relied upon to disclose irregularities, such as fraud, and other illegal acts and errors that may occur with regard to such matters.

Our firm is not being engaged to conduct a statutory audit of the financial records of any of your Entities and we will not express an auditor’s opinion as to the truth and fairness of the financial statements.

2.4    Obligation to correct false or misleading statements

By law, registered tax practitioners must not (in any capacity) make a statement to (or prepare a statement that they know or ought reasonably to know is likely to be made to) the ATO, the TPB or another Australian government agency, or permit or direct someone else to make or prepare such a statement, that they know or ought reasonably to know is false, incorrect, or misleading in a material particular, or omits any matter or thing without which the statement is misleading in a material respect.

If we become aware that a statement we made or prepared (or permitted or directed another to do so) to the ATO, the TPB or another Australian government agency on your behalf or on behalf of a client in your Group was false, incorrect or misleading in a material particular (including by omission) at the time it was made, we may advise you to take action to correct the false or misleading statement. 

If after a reasonable period of time after providing this advice, we are not reasonably satisfied that you or the relevant Group client has corrected the statement (or provided consent for us to correct the statement) or adequately explained the basis for the statement, we may take further action.  In some cases, this may include withdrawing from the engagement and notifying the ATO or the TPB about the matter.

2.5   Ownership of documents

The financial statements, tax returns and any other documents which we are specifically engaged to prepare, together with any original documents given to us by you, shall be your property.  Any other documents brought into existence by us, including general working papers, the general ledger and draft documents will remain our property at all times.

If our services are terminated (by either party), each client separately agrees that we shall be entitled to retain all documents owned by that client (including all tax refund cheques of that client which come into our possession) until payment in full of all outstanding fees outstanding from all members of the Group on any account.  Where copies of any documents released to you are required for our records, you will be charged for the cost of photocopying at our normal rates.

2.6   Additional services

The scope of our engagement is the preparation and lodgment of the accounting and taxation matters detailed above.  Any agreed fee applies only to services and advice provided within the scope of our engagement.  This fee includes checking and forwarding original assessments and payment notices that are received from the ATO and the Australian Securities & Investments Commission (ASIC).

However, any additional services or advice that you request are outside the scope of this letter and are not included in this agreed fee.  We will separately advise you of the fee for these services, including any direct out of pocket expenses.  Please note in particular that any correspondence from the ATO or ASIC that does not relate to initial assessments or original payment notices, will be charged as additional services.

2.7   Fees and charges

Our services will be provided to you on a fee for service basis.

Unless otherwise stated in writing, any estimates which we provide to you of our anticipated fees, disbursements and charges for any work are only indicative of the amounts you can expect to be charged.  Estimates are not quotes or caps, and are not binding on us.

Where an estimate is given and the scope of the work changes, or if it becomes apparent that the work involves matters which were not taken into account in the estimate, we will endeavour to advise you and provide an amended estimate as soon as it is practicable to do so.

Our hourly rates:	Directors	$330 – $550
(effective 1 January 2020)	Accountants	$143 – $330
	Clerks and Secretarial	$121 – $220
	Bookkeepers	$110 – $330

Each client in the Group is jointly and severally liable to pay our fees in respect of all work performed for all members of the Group.  Payment is required on the day of your appointment or if invoiced at a later date, within 7 days, unless special arrangements are made with us. We reserve the right to charge interest of 15% on amounts that are not paid within 30 days from invoice date. We also reserve the right to withhold lodgement until payment is made.

If required, we outsource any debt collection to a debt collection agency. We will on-charge all commission fees to you at their current rates, which will be disclosed to you at the time of engagement. If we suspend work or terminate this engagement by reason of your failure to pay our fees, we will not be liable for any loss or damage suffered by any client in the Group as a result of the suspension or termination.

2.8    Goods and Services Tax (GST) – Professional fees

Our professional fees are inclusive of GST.  If our services are provided to Individuals or Entities that are registered for GST, then those Individuals or Entities may be able to claim a GST input tax credit for the GST they pay on our services.  However, this will not be the case if the services we provide are used by the recipient in creating an input taxed supply or otherwise for a non-creditable purpose.  In this situation the GST associated with our professional fees cannot be claimed as an input tax credit. 

If your matter involves a mixture of taxable, GST-free and input taxed supplies, we will not apportion our professional fees between these categories of supply unless you have expressly requested us to do so.

Please note that if you make such a request after the commencement of any particular matter it may not be possible for us to subsequently apportion professional fees that were incurred prior to receiving your request.  If you need separate advice on whether you will receive the benefit of a GST input tax credit for the GST paid to us then please contact us.

2.8.1  GST – Disbursements

In addition to our professional fees, you will be responsible for payment of expenses which we incur on your behalf (together with the GST that we pay in relation to such expenses), as set out below.

Certain government charges and fees included in some matters undertaken in the scope of our engagement are effectively GST-free to the applicant, but will attract the 10% GST if paid by this firm and then passed on to you as part of our services.  Accordingly, for certain disbursements in this category, namely:

• ASIC fees;
• new company and trust deed orders; and
• other specific disbursements notified from time to time,

we will act as your agents in incurring those disbursements.  You will therefore technically be primarily liable to pay the account to the supplier. Under this agency relationship, you will receive the benefit of any concessional GST treatment of any part of the disbursement.

Where GST is payable on some or all of a supply acquired by us as your agent, we will forward you the Tax Invoice and you will be entitled to claim the input tax credits directly if you have an ABN and are entitled to claim input tax credits.

For disbursements incurred in this manner, we may in some cases require that you provide us with separate cheques for the relevant amounts to be paid directly to the relevant government body or supplier.

For all other disbursements (e.g., couriers, searches, photocopying, etc.) the treatment will be the same as for professional fees – i.e., we will incur the costs at first instance and invoice them on to you after making allowance for any GST input tax credits received by us on the acquisition.  These invoices will include GST for which you may be entitled to claim an input tax credit.

2.9    Confidentiality

We will keep information acquired as a result of this engagement confidential and will not disclose confidential information relating to clients in the Group without permission, unless there is a legal duty to do so.  We will also not use any information acquired as a result of this engagement for our own personal advantage or for the advantage of a third party.

We may also need to disclose information relating to a client’s affairs to:

• other clients in the Group to assist in performing our work;
• persons responsible for the governance of an entity to comply with professional standards;
• the relevant parties in order to protect our professional interests in legal proceedings;
• a professional or regulatory body in response to an inquiry or investigation;
• the relevant parties (e.g., the TPB) to comply with technical and professional standards (including ethical requirements); or
• a professional body of which we are a member, in relation to a quality review program undertaken by that body.  

Each client in the Group hereby authorises us to do so when we consider it appropriate to further our performance of work for the Group, or when requested by the relevant party.

2.10 Utilising outsourced services

From time to time, our firm may use “outsourced services” (which may include “Cloud Computing”) to perform some of the services we are engaged to perform for you.

The list of third party service providers currently used by our firm, to whom client information will or may be disclosed, are as follows:

• SMSF Engine Pty Ltd. Melbourne, Australia. SMSF Auditors and preparation.
• Sequoia Superannuation Pty Ltd. Sydney, Australia. SMSF Auditors.
• Baumgartner Super. Melbourne, Australia. SMSF Auditors.
• Assured Super Pty Ltd. Melbourne, Australia. SMSF Auditors.
• Law Central Co Pty Ltd. Perth, Australia. Legal document creation.
• Brisbane, Queensland. Legal document creation.
• Carly Allen. Perth, Australia. Marketing services.

We will notify you of any change to this list from time to time.

Each client in the Group hereby authorises us to disclose information relating to that client’s affairs to such third party service providers as we may choose to engage to perform such work.

Where we outsource services to third party providers, we are nevertheless responsible for the conduct and activities of those providers and for the delivery of the services we are engaged to perform for you.

2.11  Use of “Cloud Computing” (that is not an outsourced service)

From time to time, our firm may utilise “Cloud Computing” in the performance of services under this engagement which is not an “outsourced service”.

The list of “cloud computing” service provider(s) currently used by our firm in the provision of services which is not an outsourced service, to whom client information will or may be disclosed, is as follows:

• Essential Business Information Technology. Perth, Australia. IT services.
• Xero Limited. Melbourne, Australia. Bookkeeping software.
• Intuit Australia Pty Ltd. Sydney, Australia. Bookkeeping software.
• SuiteFiles Limited. Brisbane, Queensland. Document management.
• Nowinfinity Pty Ltd. Brisbane, Queensland. ASIC management.
• Digital Disruption Solutions Pty Ltd. Melbourne, Victoria. ATO mail collection and processing.
• Albury, Australia. Client onboarding software.
• California, USA. Password management.
• Sydney, Australia. Payroll data collection.
• Perth, Australia. Automation solutions.
• 3cx. Sydney, Australia. Phone system.

We will notify you of any change to this list from time to time.

Each client in the Group hereby authorises us to disclose information relating to those clients’ affairs to such “Cloud Computing” service providers as we may choose to engage.

2.12 Non-compliance with Laws and Regulations (NOCLAR)

During the performance of our work under this engagement, we may detect conduct or a transaction that is considered to constitute NOCLAR, which has a material effect on any documents or information that might be required to be provided to a regulatory authority (RA), such as the ATO.

If we detect any NOCLAR, we may have an ethical requirement to make a disclosure to a RA.  We will follow a formal process which will include advising you of our concerns, and if necessary, seeking legal advice.  If we do seek legal advice we reserve the right to ask you to pay or reimburse us for our reasonable costs.

If we are required to make a disclosure to a RA, you agree to forever release us from any claim for costs or losses you incur in responding to or dealing with anything that arises from our disclosure.

2.13 Losses from unauthorised cyber-activity

We will take all reasonable precautions to ensure that any electronic data that contains your private information is securely stored and that any email transmissions are protected and are not able to be intercepted by third parties.  However, we cannot be held liable for any loss that you might incur as a consequence of any third party intervention that accesses, procures or copies any data that contains your private information from any medium or device we use to store or transmit such information.

In the event that, despite our firm having taken reasonable precautions to securely store your private information, you suffer any losses arising from unauthorised cyber-activity, you agree to forever release us from any claim for your losses.

2.14 Conflicts of interest

We will inform you if we become aware of any conflict of interest in our relationship with you (including between any of the individuals and entities in your Group that are covered by this engagement letter) or in our relationship with you (including members of your Group) and another client of this firm.

Where conflicts are identified which cannot be managed in a way that protects the interests of you or any members of your Group, then we may be unable to provide further services to some or all of the persons to whom this engagement applies.  If this arises, we will inform you promptly.

2.15  Complaints

If you have a complaint about our Tax Agent / BAS Agent services, you will need to contact your Accountant in the first instance with details by email. If they are unable to resolve your complaint within 14 business days, please contact Bobby Serval – Managing Director by email. Your complaint will be investigated by a staff member who is not involved in the subject matter of the dispute, where possible. We will provide you with email acknowledgement of receipt of your  complaint and our understanding of the circumstances. The email will inform you that we will attempt to resolve your complaint with 28 days and will outline the dispute resolution process.

If you are unhappy with the outcome that we propose to you, you can then make a complaint to the Tax Practitioners Board (TPB) via www.tpb.gov.au/complaints. The TPB will send you an email to acknowledge the receipt of your complaint and review and risk assess your complaint. If you are unhappy with how the TPB has dealt with your complaint, the above link includes details about your review rights and who can further assist you.

2.16  Professional indemnity insurance

Our firm maintains adequate professional indemnity insurance cover and that our policy complies with the minimum requirements of the Tax Practitioners Board (TPB).  Details of our professional indemnity insurance arrangements are as follows:

• We hold a professional indemnity insurance policy that meets the minimum requirements set out in the TPB’s explanatory paper TPB(EP) 03/2010.

2.17 Limitation of liability

Our firm’s liability may be limited by a scheme approved under Professional Standards legislation and applicable regulations of the Professional Body. 

3.     Details of services to be provided

We shall now outline the basis of our engagement in the context of the specific services to be provided.

It should be noted at the outset that, as a general proposition, we rely upon our clients to provide us with accurate and timely information to enable us to properly perform our engagement obligations. Consequently, any rectifying work performed by us on the basis of incorrect or late information will be work which is outside the scope of this letter and will be charged as additional services.

3.1   BAS returns (if applicable)

As the BAS returns are prepared quarterly and lodged during the financial year, it is not possible for this firm to review the correctness of the underlying financial information as part of the preparation of the quarterly BAS return.  This is because we are engaged to prepare the annual accounts and these are prepared after the conclusion of the financial year.

Therefore, for the quarterly BAS returns, we will rely on and process the financial information provided to us without any review of the primary source documents.  In doing that, we will make the following specific assumptions:

• The financial information provided to us is accurate.
• The financial information correctly states the GST position. For example, all input tax credits and GST payable amounts have been correctly recorded in the general ledger.  If you are unsure of the correct position or require advice regarding this, we are able to provide this as work which is outside the scope of this letter and charged as additional services.
• You have the necessary supporting documentation to satisfy the ATO for GST purposes. Again, if you are unsure of the ATO requirements or require advice regarding these documents, we are able to provide this as work which is outside the scope of this letter and charged as additional services.
• You hold valid tax invoices and adjustment notes for all expenditure incurred by you in respect of which an input tax credit is being claimed. Substantial penalties apply for an incorrectly prepared BAS.  If you have any queries in respect to this, please contact our office for assistance. 

However, it is possible that, when the financial accounts are prepared, some discrepancies will exist between the information disclosed in the quarterly BAS returns and in the annual financial statements. 

Should any discrepancies arise, we will discuss the need to correct either the BAS returns and/or financial accounts.  Those services will involve work which is outside the scope of this letter and will be charged as additional services.

3.2   Financial accounts (if applicable)

This firm has been engaged to prepare the annual financial accounts of the Entities in your Group.  This service includes the preparation of:

• a profit and loss statement;
• a balance sheet; and
• notes for the above accounts.

This service includes maintenance of the chart of accounts for the general ledgers of your Entities, and telephone support should you require any assistance as to how to record specific transactions in the general ledger.  This service also includes the preparation and lodgement of any standard reports that are required to be furnished to ASIC.

However, this service does not include the preparation of one-off accounts for presentation to your financiers for additional finance and the like.

3.3   Income tax returns (if applicable)

This firm has been engaged to prepare and lodge income tax returns for your Group.

This firm will not be responsible for reviewing or verifying any financial records or statements provided to it either via manual cashbooks or prepared on accounting software such as Xero, MYOB or Quickbooks.  Correct coding or classification of accounts is outside the scope of this engagement.  If assistance is required on how to correctly code, or to review how you currently do so, please discuss this with us.  This will entail work which is outside the scope of this engagement and will be charged as additional services.

Also please ensure that you have all source documentation available to allow this firm to analyse the income tax implications of any transaction, if we request to see it.  Whilst we will not as a matter of course be looking at these documents, the ATO will expect you (and you are required) to have them available before any claim is made in your income tax return.  We may in some circumstances also request to see source documents if a tax issue is particularly contentious.

It is also expected that, in respect of individual income tax returns, each person will have the necessary documents so as to comply with the substantiation provisions of the Income Tax Assessment Act. 

We will specifically advise as to the requirements of the substantiation provisions relating to your income tax return and of the necessity to obtain acceptable receipts as specifically required by the legislation.  We will not, however, be checking that the requirements of the substantiation provisions have been satisfied.

This specifically means that we will not be reviewing your log book or any calculations or information you provide us, such as a rental property schedule either prepared by you on a spreadsheet or by a property manager.  If you require assistance in completing a log book or preparing any calculations, or you would like us to review such work, please discuss this with us.  This will entail work which is outside the scope of this letter and will be charged as additional services.

From time to time, this firm prepares templates and schedules to assist with the collation of information to complete income tax returns.  These will be provided free of charge.

The fee for this service does not cover any inquiries made to us, or investigations involving us, conducted by the ATO.  Substantial penalties apply for an incorrectly prepared income tax return.  If you have any queries in respect to this, please contact our office for assistance.

3.4   Fringe Benefits Tax (FBT) returns (if applicable)

This firm has also been engaged to prepare and lodge the FBT returns for your Entities.  Please note, because of the impact of GST, it is not impossible to prepare an FBT return from the information contained in the general ledger.  It is necessary to revert to the source documentation to allow our firm to analyse the FBT implications of any transaction.

Our fee for this service includes the following:

• Advice on how to collate the information necessary to prepare the annual FBT return;
• An annual review of the methods available to reduce the FBT expense on the annual FBT return;
• Telephone advice on basic FBT issues; and
• The calculation of Reportable Fringe Benefits Tax Amounts that may be required to be included on the annual payment summaries for your employees (including family members employed in the business of any Entity).

3.5    Single Touch Payroll (‘STP’) reports (if applicable)

We will prepare and lodge weekly, fortnightly, monthly or quarterly (whichever is applicable) STP reports with the ATO for the Group, based on the information provided to us by you, your employees or any third party authorised by you, without reviewing or verifying the payroll calculations, any relevant wage rates or the source documents relied upon to process each STP pay event. 

We will only provide a lodgment service.  We make no representations about the accuracy of the information submitted, the due date or whether it is received by the ATO. 

Our firm is not being engaged to perform, or check the accuracy of, payroll calculations associated with the STP reports.  You and your employees are responsible for correctly preparing and processing each pay event, and for maintaining the necessary supporting documentation.

You and your employees are also responsible for calculating and remitting your PAYG withholding and Superannuation Guarantee liabilities with respect to each employee, for each relevant pay event.

3.6 ASIC Corporate Compliance (if applicable)

The firm has been engaged to prepare ASIC company statements and any other ASIC correspondence for your Group.

This firm will not be responsible for reviewing or verifying details, we make no representations about the accuracy of the information submitted. You and your employees are responsible for correctly reviewing and verifying details on the ASIC company statement and maintaining the necessary documentation.

We will rely on and process the information provided to us without any review of the primary source documents. In doing that, we make the following specific assumptions:

• The information provided to us is accurate, including contact details, shareholder details and director details

Our firm is not responsible for paying any fees from ASIC. You and your employees are responsible for ensuring all fees are paid by the due date.

Should any discrepancies arise, we will discuss the need to correct the ASIC correspondence. Those services will involve work which is outside the scope of this letter and will be charged as additional services.

3.7    Superannuation (if applicable)

This firm has also been engaged to attend to the income tax compliance work for your self-managed superannuation fund (SMSF).  This assignment will involve the following:

• Preparation of the SMSF’s accounts for the purposes of the Superannuation Industry Supervision Act 1993 (the SIS Act).
• Preparation and lodgement of the SMSF annual return. It is important to note as part of the regulatory framework for SMSFs, an annual audit of the fund must be undertaken and provided to the trustees of the fund before the SMSF annual return is lodged.  Therefore, trustees of the fund must ensure that they provide the fund accounting records no later than 31 October to allow these tasks to be completed.

With respect to the annual audit of the SMSF referred to above:

This office will make arrangements for the audit to be undertaken by an external party whereby you will be billed directly and liable for all costs associated with the completion of the audit.

In addition to the basic financial information required to complete these requirements, it is expected that the source documentation will be available to allow this firm to analyse the implications of any superannuation related transaction.

You should also note that the deeds of the fund should be annually reviewed by a superannuation specialist to ensure they continue to comply with the requirements of the SIS Act.  Our engagement does not extend to the provision of such legal advice and our fee does not include this service.  We are happy to recommend the services of a superannuation specialist for this task.

This service does not cover any inquiries or investigations by the ATO.

3.8    Superannuation-related financial advice

We do not hold an Australian Financial Services Licence and are not an authorised representative of such a licence holder.

As a result, we are generally prohibited from providing you with any advice, recommendation or opinion that is intended to influence you in making any decision in relation to superannuation (including whether to establish, contribute to or draw benefits from a superannuation fund, or any investment decision by an superannuation trustee), or that could reasonably be regarded as being intended to have such an influence (Financial Advice).  However, we are able to provide you with superannuation advice that is of a factual nature only (e.g., to explain how superannuation rules would apply to you and what options are available to you).

Where you request us to undertake superannuation-related work (e.g., to arrange for the establishment of a self-managed superannuation fund), we will be obliged to perform that work in accordance with your instructions, even if we believe those instructions may not be in your best interest.

Where you request Financial Advice concerning superannuation, we will endeavour to assist you in obtaining that advice from an appropriately-licenced advisor.  Depending on the circumstances, this may involve us outsourcing the provision of the Financial Advice (in which case we would seek your prior authorisation), or referring you to a licenced provider directly. 

4.     Agent nomination process – Client-to-agent linking

The ATO requires all taxpayers with an Australian Business Number to undertake certain steps to nominate a registered tax or BAS agent. 

This process is referred to as ‘Client-to-agent linking’ (‘CAL’) and, importantly, it must be completed by the taxpayer seeking to nominate an agent.  It cannot be done by agents on behalf of their clients.

Registered agents have digital access to their clients’ tax information and the functionality to lodge returns and forms through the ATO’s online services. Client-to-agent linking was introduced to strengthen the security of these online services.

Client-to-agent linking also helps protect a client’s information (e.g., from identity theft) by requiring them to securely nominate a registered agent using the ATO’s online platform, Online services for business.

From 13 November 2023, this new nomination process must be completed by a client with an ABN (except a sole trader) if they are:

• engaging a new registered tax or BAS agent, or payroll service provider to represent them; or
• changing the authorisations given to an existing agent (for example, to start representing the client for a new obligation such as income tax, FBT, or to represent a new entity in the client group).

Importantly, clients do not need to do anything if they are already represented by a registered agent, and they are not making any changes.

For any applicable clients in your group that we have determined will need to undertake this process to nominate our firm as their registered tax agent, we will advise you accordingly.

You can follow the steps listed here from the ATO to complete the process.

Please notify us as soon as the nomination process is completed by each client in your Group.  We will then have 28 days to connect to the client on the ATO’s systems.  Please note that we cannot perform any work for a client who has not successfully completed the client-to-agent linking nomination process.

Unfortunately, we cannot complete this process on your behalf. However, we can help you in understanding what you need to do. For assistance, please contact us on 6144 3370. Alternatively, you can contact the ATO on 13 28 66 or visit their website for more details.

5.     Authorisation of ATO digital communication preferences

Each client in the Group set out in the accompanying Schedule of Clients agrees to have the following ATO communication types sent digitally to our registered tax agent, being Ultimate SK Pty Ltd T/A Ultimate Tax & Advisory where applicable:  

• Income tax.
• Superannuation.
• Study and training support loans.
• Activity statement related.
• Debt.
• Employer and business obligations.

We hereby authorise Ultimate SK Pty Ltd T/A Ultimate Tax & Advisory to change or withdraw our preferred address for service of ATO communications.

We declare that the information supplied by us to Ultimate SK Pty Ltd T/A Ultimate Tax & Advisory for the setting or updating of these communication preferences is true and correct.

6.     Other prescribed events and matters to be aware of

We are required to advise if certain prescribed events have occurred within the last five years (but not before 1 July 2022).  This will enable each client in the Group to make a fully informed decision on whether to engage or re-engage Slobodan Serval to provide tax agent services. 

• We advise there are currently no matters that we are required to report to you and the Group.

We are also required to advise whether the tax or BAS agent registration of Slobodan Serval is subject to any conditions.

• There are no conditions attached to our registration.

7.     Communication

There are a number of ways that we will communicate with you regarding your affairs. Our standard office hours are Monday to Friday 9am to 5.30pm.  We will never contact you unnecessarily. Signing of this engagement letter confirms you agree to use of these communication methods.

7.1    Email

We will send direct emails to you from any of our staff about important dates, essential information and more. We will also send reminders, monthly newsletters etc from a digital marketing platform.

7.2    SMS

We will send you reminders, prompts to open documents and reminders about critical dates etc via SMS to your listed phone number.

7.3    Meetings

Meetings can include phone calls, in-person and virtual meetings. We may record any or all meetings to assist us with answering your queries. These recordings will be held securely and are subject to our Privacy Policy available on our website.

8.     Confirmation of engagement

Obviously, there are many issues to consider in this engagement and we ask that you consider all aspects of this letter to ensure that you are satisfied with the scope of our engagement.  Please contact us if you have any queries about this letter. 

Once you are satisfied with the terms of this letter, would you please have all persons sign and date both copies of this letter in the places indicated. 

One copy should be forwarded to us as evidence of your acceptance of the terms of our engagement.  You should retain the other copy as your evidence of our engagement. 

We note again that we are unable to perform any work for you until we receive the signed letter.

We thank you for the opportunity to provide accounting and taxation services to your Group and we look forward to developing a close accounting relationship with you for many years to come.

Thank you in advance,

Bobby Serval

Managing Director