Terms & Conditions of Engagement
Terms and Conditions of Engagement
These Terms and Conditions of Engagement (“Terms and Conditions”) shall supplement the terms of engagement set forth in the written engagement letter of AdamsBrown, LLC (herein “we” and “us”). These Terms and Conditions are hereby incorporated into such engagement letter as if fully set forth therein (these Terms and Conditions, together with the engagement letter, are collectively referred to herein as the “Engagement”). To the extent these Terms and Conditions conflict with the terms of the engagement letter, the terms of the engagement letter shall control.
You are responsible for providing all information needed by us to provide the services identified in the engagement letter. We will not audit or otherwise verify the information provided, although we may request clarification if needed. Our work in connection with this Engagement does not include any procedures designed to discover errors, fraud, or other illegal acts, should any exist. However, we will inform you of any material errors that come to our attention and any fraud that comes to our attention. We will also inform you of any illegal acts that come to our attention, unless clearly inconsequential. Our responsibility as a tax preparer is limited to the tax period specified in the engagement letter and does not extend to any later period for which we are not engaged as tax preparers. With respect to business entities, our services are not designed to provide assurance on internal controls or to identify reportable conditions, that is, significant deficiencies or material weaknesses in the design or operation of internal control. Accordingly, we have no responsibility to identify and communicate significant deficiencies or material weaknesses in your internal controls as part of this engagement, and our engagement cannot be relied upon to disclose same. However, during the procedures, if we become aware of such reportable conditions, we will communicate them to you.
It is your responsibility to safeguard your assets and maintain accurate records pertaining to all transactions. If you have a business entity, management is responsible for the proper recording of transactions in the books of accounts, for the safeguarding of assets, and for the substantial accuracy of the financial records. If applicable, you are responsible for ensuring that personal expenses are segregated from business expenses and that expenses such as meals, travel, vehicle use, contributions, and related expenses are supported by necessary records required by the IRS and other taxing authorities. Please contact us for advice if you have any questions on the types of supporting records required. We will render any accounting or bookkeeping assistance we find necessary for preparing the income tax returns for a business entity if you are not able to complete such accounting. You will be responsible for the payment of these services.
We, in our sole professional judgment, reserve the right to refuse to take any action that could be construed as making management decisions or performing management functions on your behalf.
U.S. Filing Obligations Related to Foreign Financial Assets.
As part of your filing obligations, you are required to report the maximum value of specified foreign financial assets, which include financial accounts with foreign institutions and certain other foreign non-account investment assets that exceed certain thresholds. You are responsible for informing us of all foreign assets, so we may properly advise you regarding your filing obligations. These assets include ownership interest you or your entity (as applicable) directly or indirectly hold in businesses located in a foreign country, and any assets or financial accounts located in a foreign country over which you have signature authority. You are responsible for complying with the tax filing requirements of any other country. We have no responsibility to raise these issues with you and foreign filing obligations are not within the scope of this Engagement.
Gift Tax Returns.
The IRS considers a gift to be any direct or indirect transfer to an individual where full consideration (measured in money or money’s worth) is not received in return. Under federal tax law, certain gifts are not taxable, and taxable gifts are subject to both an annual gift tax exclusion amount and a lifetime gift exclusion amount. State law governing gift taxes, including the lifetime exclusion, varies by jurisdiction. You are responsible for informing us if gift tax returns are required to be filed.
The IRS considers virtual currency (e.g. Bitcoin) as property for U.S. federal income tax purposes. As such, any transactions in, or transactions that use, virtual current are subject to the same general tax principles that apply to other property transactions. If you or your entity had virtual currency activity during the tax year, you or your entity may be subject to tax consequences associated with such transactions and may have additional reporting obligations. You agree to provide us with complete and accurate information regarding any transactions in, or transactions that have used, virtual currency during the applicable tax year.
We will use our judgment to resolve questions in your favor where the tax law is unclear or where there are conflicts between the taxing authorities’ interpretation of the law and what seem to be other supportable positions. There may be situations where we are required by law to disclose a position on a tax return. We will adopt the positions you request on your returns or the entity returns so long as it is consistent with our professional standards and ethics. We must have a reasonable belief that it is more likely than not that the position will be held to be the correct position upon examination by taxing authorities. If we do not have that reasonable belief, we must be satisfied that there is at least a reasonable basis for the position, and in such a case, the position must be formally disclosed on Form 8275 or 8275-R, which form would be filed as part of the return. In order for us to make these determinations, we must rely on the accuracy and completeness of the relevant information you provide to us, and, in the event we and/or you or your entity is assessed penalties due to our reliance on inaccurate, incomplete, or misleading information you supplied to us (with or without your knowledge or intent), you will indemnify us, defend us and hold us harmless as to those penalties. In the event you ask us to take an unsupported tax position or refuse to make any required disclosures, we reserve the right to withdraw from the engagement without completing or delivering the tax returns. Such withdrawal would complete our engagement and you agree to pay our fee based on time expended plus all out-of-pocket expenses through the date of withdrawal.
Entity Additional Responsibilities
Business entities are responsible for adopting sound accounting policies, for maintaining an adequate and efficient accounting system, for safeguarding assets, for authorizing transactions, for retaining supporting documentation for those transactions, and for devising systems of internal controls that will, among other things, help assure the preparation of proper income tax returns. Furthermore, entities are responsible for the management decisions and functions, for designating a competent employee to oversee any of the services we provide, and for evaluating the adequacy and results of those services. You shall inform us of all known or suspected fraud affecting the entity involving (a) management, (b) employees who have significant roles in internal control, and (c) others where the fraud could have a material effect on the financial statements. You are also responsible for informing us of your knowledge of any allegations of fraud or suspected fraud affecting the entity received in communications from employees, former employees, regulators, or others. You are further responsible for ensuring that the entity complies with applicable laws and regulations.
Conflict of Interest.
If we, in our sole discretion, believe a conflict has arisen affecting our ability to deliver services to you in accordance with either the ethical standards of our firm or the ethical standards of our profession, we may be required to suspend or terminate our services without issuing our work product. We will notify you of our decision to withdraw due to a conflict and will take all reasonable steps to assist in the transfer of your tax services.
Your returns may be selected for review by one or more taxing authorities. If your personal or business entity return is selected for examination or audit, you may request our assistance in responding to such an inquiry. We will confirm this representation in a separate engagement letter.
State and Local Filing Obligations.
Our services are not intended to determine whether you have filing requirements in taxing jurisdictions other than the one(s) you have informed us of. As an ancillary service, and upon mutual agreement, we can perform a nexus study to determine whether any other filings are required.
The law provides various penalties and interest that may be imposed when taxpayers understate their tax liability. If your entity is an S Corporation or partnership, tax attributes of the entity generally flow through to its partners or members. You acknowledge that any such understated tax, and any imposed interest and penalties, are your or your entity’s responsibility and that we have no responsibilities in that regard. If you would like information on the amount or circumstances of these penalties, please contact us.
It is our policy to retain tax returns and engagement documentation for a period of seven (7) years. We do not keep any original client records, so we will return those to you at the completion of the services rendered under this Engagement. It is your responsibility to retain all documents, including cancelled checks and other data and financial reports and records that form the basis of income and deductions as well as any work product provided to you by us. These may be necessary to prove the accuracy and completeness of the returns to a taxing authority. We do not accept responsibility for hosting client information; therefore, you have the sole responsibility for ensuring you retain and maintain in your possession all your financial and non-financial information, data, and records. This applies to business entities as well. Upon the expiration of the seven (7)-year period, we shall be free to destroy our records related to this Engagement.
We may from time to time use third party service providers in the process of preparing your income tax returns. These individuals are personally known to us and have signed a contractual agreement to maintain the confidentiality of your information.
Certain communications involving tax advice may be privileged and not subject to disclosure to the IRS. By disclosing the contents of those communications to anyone, or by turning over information about those communications to the government, you (or other employees) of an entity may be waiving this privilege. To protect this right to privileged communication, please consult with us or your entity’s attorney prior to disclosing any information about our tax advice.
In the event that we are or may be obligated to pay any cost, settlement, judgment, fine, penalty, or similar award or sanction as a result of a claim, investigation, or other proceeding instituted by any third party, and if such obligation is or may be a direct or indirect result of any inaccurate, incomplete, or misleading information that you may provide to us during the course of this engagement (with or without your knowledge or intent), you agree to indemnify us, defend us (with counsel of our choosing), and hold us harmless against such obligation.
Please be on notice that some owners of AdamsBrown, LLC are also either owners or representatives of Adams Brown Wealth Consultants, LLC and may receive directly or indirectly either commissions, fees, or cost reimbursement with respect to any business you conduct, including services or products with Private Client Services. Additionally AdamsBrown, LLC may receive indirect financial benefits in the event you do business with AdamsBrown Wealth Consultants, LLC, or its representatives. This disclosure is provided pursuant to the AICPA Code of Conduct and the Kansas Board of Accountancy.
In the course of providing services to you, you may request referrals to products or professionals such as attorneys, brokers, or investment advisors. We may identify professional(s) or product(s) for your consideration. However, you are responsible for evaluating, selecting, and retaining any professional or product and determining if the professional or product can meet your needs. You agree that we will not oversee the activities of and have no responsibility for the work product of any professional or the suitability of any product we refer to you or that you separately retain. Further, we are not responsible for any services we provide that fail to meet the intended outcomes as a result of relying on the services of other professionals or products you may retain.
In connection with this Engagement, we may need to provide additional accounting or research services. We are available to consult regarding other tax matters, income tax projections, or research related to specific matters. Such services would be in addition to this Engagement. This Engagement does not cover the preparation of financial statements.
Newsletters and Similar Communications.
We may send newsletters, emails, explanations of technical developments or similar communications with you from time to time. These communications are of a general nature and should not be construed as professional advice. We may not send all such communications to you. These communications do not, by themselves, constitute a client relationship with you, nor do they constitute advice or an undertaking on our part to monitor issues for you.
Our fees for this Engagement are not contingent on the result of the services. If we elect to terminate our services for nonpayment, or for any other reason, the Engagement will be deemed to have been completed upon written notification of termination, even if your tax returns or other work you have engaged us to perform are not complete. You will be obligated to compensate us for all services provided under this engagement and to reimburse us for all out-of-pocket costs, through the date of termination. Any fees or expenses past due will be subject to a finance charge computed on a periodic rate of 1.5% per month, 18% annual percentage rate.
If personal income tax returns we prepare are joint returns, both parties are our clients. In that event, each of you acknowledge that there is no expectation of privacy from the other concerning our services in connection with this Engagement, and we are at liberty to share with either of you, without the prior consent of the other, any and all documents and other information concerning preparation of your tax returns. We may ask that any request for documents or other information be communicated to us in written form. Unless we are notified otherwise in advance and in writing, we may construe an instruction from either you to be an instruction on your joint behalf.
In the event we are required to respond to a subpoena, court order or other legal process for the production of documents or testimony relative to information we obtained or prepared during the course of this Engagement, you agree to compensate us at our then current hourly rates for the time we spend in connection with such response, and to reimburse us for all of our out-of-pocket costs incurred in that regard.
(A) Restrictions on Solicitation. We have made a significant investment in the recruitment and training of our personnel. The loss of such personnel as a result of your actions would be detrimental to our current and future business success. During the term of our engagement and for two (2) years thereafter, you shall not, directly or indirectly, hire, employ or work with (or recruit or solicit to hire, employ or work with), or otherwise engage the services of, any of our personnel; induce any of our personnel to terminate his or her relationship with us; or introduce any of our personnel to any potential employer as a candidate for employment or similar relationship. (B) Remedies for Breach. If you violate these restrictions, you shall pay us an amount equal to one (1) year of the affected personnel’s annual compensation package, which may include, but is not limited to, base salary and wages, bonus and incentive payments, the costs of the company paid benefits (including all health, life, dental and other insurance premiums and retirement plan contributions), employer paid federal and state employment taxes, and any other form of compensation whether paid to an employee or contractor, all based on the assumption that contingent payments have been earned. (C) Survival. The restrictions and obligations hereunder shall survive termination of our engagement by you.
Electronic Data Communications, Storage and Use of Third Party Service Providers.
In the interest of facilitating our services to you, we may communicate by facsimile transmission, send data over the internet including the use of electronic mail communications, store electronic data via computer software applications hosted locally on secure servers we own or remotely on secure third-party cloud systems/applications and servers, or allow access to data through third-party vendor secured hosted portal services. Confidential electronic data may be transmitted or stored using these methods. We may use third-party service vendor secured hosted portal services. We may also use third parties within the United States to complete the services under this Engagement. These third parties may in the performance of such services have access to your confidential information. You recognize and accept that we have no control over the unauthorized interception or breach of any communications or data once it has been sent or has been subject to unauthorized access, notwithstanding all reasonable security measures employed by us or our third-party vendors. You consent to our use of these electronic devices and applications and submission of confidential client information to third-party service providers during this Engagement, and you agree to hold us harmless for any breach of confidentiality that is not the direct result of our gross negligence or wilful misconduct. IN NO EVENT SHALL WE BE LIABLE UNDER ANY CIRCUMSTANCES FOR ANY DAMAGES PERTAINING TO LOSS OF USE, LOSS OF REVENUE, LOSS OF PROFIT, OR BUSINESS INTERRUPTION, OR FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, PUNITIVE, SPECIAL, OR SPECULATIVE DAMAGES, ARISING FROM OUR USE OF ELECTRONIC DATA COMMUNICATIONS, LOCAL AND THIRD-PARTY DATA STORAGE, OR OTHER THIRD-PARTY ELECTRONIC SERVICES, INCLUDING, WITHOUT LIMITATION, THE UNAUTHORIZED ACCESS OF YOUR CONFIDENTIAL INFORMATION, WHETHER ARISING OUT OF BREACH OF CONTRACT, TORT, OR OTHERWISE, REGARDLESS OF WHETHER SUCH DAMAGES WERE FORESEEABLE AND WHETHER OR NOT WE HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
You are hereby notified that we have in place policies for the protection of the privacy of client information. We collect non-public personal information about you that is either provided to us by you or obtained by us with your authorization during the course of our provision of services. We do not disclose any non-public personal information of our clients obtained in the course of our practice except as required or permitted by law. Permitted disclosures include, but are not limited to, providing information to our employees and, in limited situations, to unrelated third parties who need to know that information to assist us in providing services to you. We retain records relating to professional services that we provide so that we are better able to assist you and in some cases, to comply with professional guidelines. In order to guard your non-public personal information, we maintain physical, electronic, and procedural safeguards that comply with our professional standards.
Disputes; WAIVER OF JURY TRIAL.
If any dispute arises out of the Engagement, you and us shall first try in good faith to settle the dispute by mediation administered by an agreed upon mediator under its applicable rules for resolving professional accounting and related services disputes before resorting to litigation. The costs of any mediation proceeding shall be shared equally. Notwithstanding the foregoing, any dispute over fees charged by us to you will be submitted for resolution by binding arbitration in accordance with the applicable rules for resolving professional accounting and related services disputes to an agreed upon arbitrator, except that under all circumstances the arbitrator must follow the laws of the State of Kansas. Such arbitration shall be binding and final. The prevailing party in any arbitration or litigation shall be entitled to reimbursement of its reasonable attorneys’ fees and costs. EACH PARTY HEREBY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO WHICH IT MAY BE A PARTY ARISING OUT OF OR IN ANY WAY PERTAINING TO THE SUBJECT MATTER HEREOF.
Default and Remedies.
In the event of a default by either party, the non-defaulting party shall have all rights and remedies available at law, in equity, or under these Terms and Conditions.
These Terms and Conditions, together with the engagement letter, represents the entire agreement between you and us with respect to the subject matter hereof, and there are no other representations or understanding of any nature with respect to such subject matter.
Any notice required hereby shall be in writing and shall be given to the appropriate party by (i) personal delivery; (ii) certified mail, postage prepaid, return receipt requested; or (iii) recognized overnight delivery services to AdamsBrown, LLC, at its corporate headquarters, 2006 Broadway, Suite 2A, PO Drawer J, Great Bend, KS 67530, directed to the attention of the Managing Partner, and to client at the address provided to us at the time of the Engagement.
If any provision of these Terms and Conditions, or the terms of the engagement letter, will for any reason be held to be invalid or unenforceable, such invalidity or unenforceability will not affect any other provision hereof or thereof.
GOVERNING LAW; VENUE.
These Terms and Conditions, together with the engagement letter, will be construed and interpreted in accordance with the laws of the State of Kansas, without regard to its principles of conflicts of law. Any legal action brought to enforce or construe the parties’ agreement shall be brought exclusively in the courts located in Sedgwick County, Kansas, and each party hereby submits to the exclusive jurisdiction of such courts, and will not invoke the doctrine of forum non conveniens or other similar defenses.