AICPA 501-1: Responding to Requests for Client Records

The American Institute of Certified Public Accountants (AICPA) provides professional standards for its members through its Code of Professional Conduct. A specific part of this code, Interpretation 501-1, addresses a client’s request for their records. This interpretation offers clear, enforceable guidance for CPAs when a current or former client asks for documents, aiming to prevent disputes and ensure a professional handover of information.

The rules under Interpretation 501-1 require a careful understanding of how different records are classified. This guidance protects both the client’s right to their financial data and the CPA’s ownership of their own work. The interpretation outlines the specific obligations a CPA has based on the type of record requested.

Categorizing Client Records

Client-Provided Records

Client-provided records are the foundational documents that a client gives to a CPA to perform a service. These are original records belonging to the client and can include items like bank statements, receipts, invoices, and legal documents. Any record that the CPA did not create but received from the client falls into this category. The CPA has custody of these documents but does not own them.

Member-Prepared Records

Member-prepared records are documents the CPA was engaged to create and which should be part of the client’s official books and records. Examples include general ledgers, subsidiary journals, and supporting schedules like depreciation schedules. These records are often necessary for the client to have a complete financial picture. Think of these as the formal accounting records that a company would maintain internally, but which have been outsourced to the CPA.

Member’s Work Products

Member’s work products are the final deliverables for which the client engaged the CPA. This category includes items such as completed tax returns, audit reports, or analytical reports that provide a conclusion or findings. While a tax return can be a member-prepared record, it also functions as a final work product. These items represent the culmination of the CPA’s professional service, rather than the underlying data entry.

Working Papers

Working papers are the exclusive property of the CPA and are not client records. These documents contain the evidence of the work performed, including audit programs, analytical review schedules, and internal notes detailing procedures used to reach conclusions. They demonstrate how the CPA arrived at the findings in the member’s work product and support the firm’s compliance with professional standards. The client does not have a right to these internal documents.

Rules for Returning Records

The obligations for a CPA to return records are directly tied to the category the record falls into. A CPA must return all client-provided records upon request, and this obligation is unconditional. The CPA cannot hold these documents as leverage, even if there are outstanding fees for services rendered, because the records belong to the client.

For member-prepared records, the rules depend on the status of payment. A CPA must provide these records to the client, as they are part of the client’s books. However, the AICPA’s interpretation allows a member to withhold these records if fees are due for the specific engagement to prepare them. If the client has paid for the work that created the general ledger, for example, the CPA must provide it.

The rules for member’s work products, such as a completed audit report, follow a similar logic. If the client has paid for the specific service that generated the work product, the CPA must deliver it. Conversely, if fees are due for that specific work product, the CPA may withhold it.

A CPA’s working papers remain their property and do not need to be provided to the client. However, supporting records from the workpapers that contain information not otherwise available to the client must be provided if they are necessary to complete the client’s financial records. This could include adjusting journal entries that the CPA calculated.

Responding to a Record Request

When a client requests records, the CPA must respond in a timely manner. The AICPA code specifies that the response should be made as soon as practicable, but no later than 45 days after the request is made, absent extenuating circumstances. This timeframe is a firm deadline intended to prevent unreasonable delays in returning information a client may need.

A CPA should provide the records in the format in which they are kept, whether electronic or hard copy. If a client requests records in a specific format that differs from how they are maintained, the CPA is not obligated to convert them. The client would bear the cost of any such conversion. If a CPA has already provided the records once, they can charge a reasonable fee for retrieving and copying them again.

Documenting the entire process is a sound practice for the CPA. This includes keeping a copy of the client’s written request and documenting the firm’s response, including what was provided, the date it was sent, and the format. This documentation serves as evidence of compliance with professional standards and can be important if a dispute arises later.

State Board of Accountancy Regulations

While the AICPA provides a national ethical framework, it is not a legal authority. Each state has its own Board of Accountancy that licenses and regulates CPAs, and these state-level regulations always supersede the AICPA code. A CPA must comply with their state board’s rules first and foremost.

A common area where state rules differ is the withholding of records for nonpayment of fees. Many state boards have adopted stricter rules that do not permit a CPA to withhold member-prepared records or work products pending payment. In such jurisdictions, withholding records could lead to disciplinary action. Therefore, it is important for CPAs to be familiar with their specific state’s regulations before responding to any client record request.