Balancing Collections and Professional Conduct

• Rule 214 of the Code  details a CPA’s responsibilities as it relates to fee quotations and billings. The Rule notes that a CPA should:
  1. obtain adequate information before providing a fee quotation to perform any professional service; and
  2. render billings for professional services on a fair and reasonable basis and provide such appropriate explanations as are necessary to understand the billings.
• Misunderstandings regarding fees are a common cause of client concerns, underscoring the importance of adhering to this rule.
• Communication is essential. Before accepting or re-accepting an engagement, CPA practitioners should have a signed engagement letter. A well‑prepared letter helps clarify estimated fees, billing arrangements, scope and expectations. It is best practice to review important clauses, either to you or the client, in the engagement letter with your client so that any possible confusion is prevented. Many request the client to initial next to these clauses to evidence that they have been communicated and understood.
• Use retainers where possible, particularly for higher‑risk clients, or for longer engagements. Where retainers are used, practitioners must comply with Rule 411 (cash transactions) and Rule 212 (handling the property of others) of the Code. As mentioned above, consider including an engagement letter clause that relates to the retainer to ensure it is communicated and clear, and have the client initial next to it.
• Similarly, you could request for upfront payment or include in your engagement letter that you require the bill to be settled prior to delivery of the final report. This is more common for shorter engagements such as personal tax returns. Your ability to forecast the final bill is important if you are charging upfront or using fixed pricing for certain engagements, so ensure your client acceptance and continuance process is well thought out. 

Additional Considerations

Practitioners may consider implementing further measures to mitigate fee‑related disputes and improve receivable management by:

• Using your professional judgment, which is key when there are outstanding fees, especially if the client may be facing CRA penalties and/or interest. Whether or not you delay filing because of an outstanding fee depends on what is in the engagement letter, the Code, and how this would play out if challenged in court.
• Offering a payment plan or settlement plan. This may also be included in the engagement letter.
• Utilizing mediation or negotiation when disputes relate to service quality or the scope of the engagement.
• Knowing what a collection agency does and doesn’t do for you.
• Considering the legal requirements and best practice of when to engage a collection agency and any limitation periods that may apply.
• Making good‑faith efforts to collect outstanding amounts internally before engaging a collection agency. Such actions may include:
  • courteous reminders
  • progressively firmer notices
  • phone calls to discuss concerns

Supporting guidance articles

Avoiding complaints about fees

Further Questions?

Should you have further questions about the above please contact the Member Advisory Services team at professionaladvisory@bccpa.ca for additional guidance.

The information in this document was current and accurate when it was published (see date at the top). While we try our best to update and remove old documents, there is a chance we miss some. Always refer to the most recent version of the Act, Bylaws, or Code (linked) posted on the CPABC website as the wording therein prevails over information in this document. If you think we did miss an update or removal, please confirm with us at ProfessionalAdvisory@bccpa.ca.