Best Certified Public Accountants in Leek

The industry standard technical releases 03/11 (Residential Service Charge Accounts) & 09/14 (Commercial Property Service Charge Accounts) issued by ICAEW both state that Service Charge accounts should be prepared on the accruals basis which recognises costs in the accounts when the expense was incurred rather than when the invoice is paid. The benefit to lessees of the accruals basis is that they can be confident that the expenses in the accounts only relate to the Service Charge period in question. This is the opposite of cash accounting, which recognises transactions only when there is an exchange of cash.

Service Charge accounts prepared to industry best practice guidelines Accounts returned to directors/managing agent in a timely manner to enable them to be distributed to lessees Accounting information to be checked thoroughly by an impartial body to ensure accuracy

Section 20b of the Landlord and Tenant Act 1985 states that if any of the relevant costs taken into account in determining the amount of any Service Charge were incurred more than 18 months before a demand for payment of the Service Charge is served on the tenant, then the tenant shall not be liable to pay so much of the Service Charge as reflects the costs so incurred. In reality this means that Service Charge accounts need to be issued to lessees within six months following the end of the financial period to avoid the non-recoverability of Service Charges by the Landlord. Here at Morton Baxter we will typically produce a draft within 2-3 weeks of receiving the year-end information ensuring there is plenty of time for the accounts to be distributed to lessees. Please see our current turnaround time at the top of this page for live turnaround information.

The industry standard technical releases 03/11 (Residential Service Charge Accounts) & 09/14 (Commercial Property Service Charge Accounts) issued by ICAEW both state that Service Charge accounts should be subject to examination by an independent accountant before being issued to lessees.

Service Charges are fees that Leaseholders pay to the Landlord to cover their share of the cost of maintaining the building. These costs for which the Leaseholder is responsible will be defined within the terms of their lease. Items usually covered by the Service Charge include cleaning of communal areas, grounds maintenance and buildings insurance. Other important information relating to Service Charges should be contained within the lease and will include: How and when to pay your Service Charge How your Service Charge is calculated Whether a Sinking Fund or Reserve Fund collection is allowed What happens if you pay excess or not enough Service Charge (e.g. expenses are higher than Service Charge collected) within the financial year Please note that Service Charges are usually variable meaning the amount you pay each year can change