Professional clearance: the letter, and the records that have to move
In short
A professional clearance letter is the note an incoming accountant sends the outgoing one, asking whether there is any professional reason not to accept the appointment. It usually resolves in under 2 weeks. The record handover behind it is the real work: without a dated trial balance, a fixed asset register, payroll year-to-date figures and reconciliations, the new firm cannot open a period.
Key takeaways
- Clearance answers one question — is there a professional reason to decline the appointment — and nothing more.
- The records request is a separate document from the clearance letter; conflating them is why handovers stall.
- 7 artefacts decide whether a period can be opened, and a trial balance on its own is not enough.
- Most handover packs arrive as PDF reports: evidence of a number, but not a usable opening position.
- Prior workpapers are the artefact most often refused, so ask early and plan for the answer being no.
Professional clearance is the enquiry an incoming accountant makes of the outgoing one before accepting an appointment: is there any professional reason we should not act? The client authorises the outgoing firm to respond, it replies, and ordinarily that is the end of it. Practitioners also call it an etiquette letter.
The useful thing to say is that the letter is trivial and the handover is not. Clearance closes in days. The records request travelling alongside it decides whether the new firm can produce accounts at all, and that is the part that goes quiet.
What the letter does, and what it does not
The clearance letter asks one question and carries the client's written authority for the predecessor to answer it. It is not a request for files, not a due-diligence check, and it transfers nothing. Put the records list inside the clearance letter and you get a reply addressing the professional question and ignoring the schedule.
Clearance is also distinct from the firm's own onboarding obligations. Verifying who the client is, who owns them and what their risk rating is happens regardless of what the predecessor says, and has its own record shape — see what a client due-diligence record has to contain. A clearance reply substitutes for none of it.
The 7 artefacts that decide whether a period can be opened
| Artefact | Why the incoming firm cannot start without it | What typically arrives |
|---|---|---|
| Trial balance at the handover date | Every opening balance in the new ledger derives from it | A PDF that does not agree to the last filed accounts |
| Fixed asset register | Depreciation continuity, disposal history, capital allowances pools | A spreadsheet with net book value only, no cost and accumulated split |
| Payroll year-to-date per employee | The first payslip run under the new firm is wrong without it | A period summary total, not per-employee cumulatives |
| Filed and unfiled returns | What positions were taken, and what is open with a deadline | Filed copies, without the computations behind them |
| Bank and control account reconciliations | Proof ledger balances agree to something outside the ledger | The last reconciliation report, no supporting item list |
| Open sales and purchase ledger items | Aged debt, unapplied cash, unallocated credit notes | An aged listing with no allocation history |
| Prior workpapers and schedules | How judgemental balances — accruals, prepayments, provisions — were derived | Frequently refused; workpaper ownership is contested |
The unapplied-cash row quietly costs the most. An aged listing says a balance is outstanding but not which payments were part-allocated against which invoices, and rebuilding that from bank data runs into the reasons remittance advice resists automatic matching.
Why a complete handover can still be unusable
- PDF is evidence, not data. A trial balance as a PDF is a picture of a position. It must be re-keyed or parsed before it enters QuickBooks, Xero or Sage, and every re-key can introduce a difference nobody can later source.
- Reports are not extracts. Software exports what it prints rather than what it stores, losing transaction identifiers, allocation links and the audit trail — the parts you need if a figure is challenged.
- Aggregates hide the detail. A payroll summary is arithmetically correct and useless: year-to-date figures live per employee, not per period.
- Access is not a copy. Read access to the predecessor's ledger ends the day their subscription lapses, usually before the first filing under the new engagement.
When the handover goes quiet
A predecessor with no commercial reason to help is a slow counterparty, and the failure looks like an unresponsive client: the 1st request gets an answer, the 2nd a partial one, the 3rd nothing. The mechanics match reminders that stop working after the second one — vague asks decay fastest, so send a numbered artefact list to a named recipient, not a paragraph.
The second failure is internal. Handover files land in a partner's inbox as attachments on a reply thread and never reach the engagement folder — the leak in records emailed to a staff member. Treat each artefact above as a tracked request item with an owner and a state, as you would a client's own records; the field shape is in the prepared-by-client list as a data structure.
Clearance tells you whether you may act. The handover tells you whether you can. Only one is usually a problem.
Making that tracked rather than remembered is a small system: a per-engagement artefact checklist, an acceptance test per item, a status view. It sits with the rest of the client intake, chasing and portals topic, inside the systems we build for accounting and tax practices, and as software rather than a spreadsheet it is the scale of an MVP and product build.
Frequently asked questions
Short answers to the follow-ups this page tends to raise.
Can the outgoing accountant refuse to hand over records?
They can withhold their own workpapers, and a lien over records may apply where fees are unpaid — this varies by jurisdiction and body, so check your institute's guidance. Rarely disputed is the client's own books and records, which belong to the client rather than the firm. Plan onboarding on the assumption that workpapers may not arrive.
Is professional clearance the same as an engagement letter?
No. Clearance asks the outgoing firm whether there is any professional reason not to act. The engagement letter is the contract with the client, setting out scope, responsibilities and terms. Clearance normally precedes it, and neither replaces the firm's own client due diligence.
How long does professional clearance usually take?
Days to a few weeks, gated almost entirely by the client returning authority for the predecessor to respond. The reply itself is short. If a change of accountant drags on for months, the delay is nearly always the records handover, not the clearance question.
What should the records request list actually say?
Name each artefact, the date it must cover, and the file format you accept. "Please send the client's records" produces a folder of PDFs; "trial balance as at 31 March as CSV, plus the fixed asset register showing cost and accumulated depreciation per asset" produces something you can load. Send it separately from the clearance letter.
- professional clearance
- client onboarding
- handover
- practice operations
The work behind this page
Builds from our portfolio that this page draws on.
AskVault
An AI internal knowledge-search platform that answers employee questions from your own docs — grounded in citations, with knowledge gaps surfaced and deflection tracked.
Productivity AIAP Copilot
An AI accounts-payable copilot that reads invoices, matches them to POs, and routes clean approvals
FintechRead next
- The prepared-by-client list is a data structure, not a spreadsheetPBC stands for prepared by client. The useful definition is structural: a list of request items, each carrying nine fields, one of which is a state machine.definition
- What a client due-diligence record has to contain before work startsDue diligence is usually written about as a compliance narrative. The deliverable is a record: 10 fields, each with evidence attached, a refresh clock and a named approver.definition
- A bookkeeping pilot passed, then the team went back to the spreadsheetQuiet abandonment after a successful trial is almost never a training problem. It is a placement problem, and there is a usage measurement that tells you which of four causes you have.diagnostic
- Gated endpoints: the ledger APIs you cannot call until your app is reviewedSandbox access proves nothing about production. Ledger platforms tier access, and the capabilities firms most want — payroll, bank feeds, filing — sit at the top tier.definition
Related across the site
Working on something in this space?
Tell us where you are in a sentence or two. We'll tell you honestly whether we're the right team, and what a sensible first slice of the work looks like.
Start the conversation