International Journal of Accounting and Taxation

Texas Law and Ethics Considerations Regarding Accountants Withholding Work Product and Documents to Enforce Fee Collection
Professor Bruce W. McClain, Professor Scott A. Yetmar

Abstract
Like other business people, accountants sometimes find themselves having difficulty in getting paid. Many times they have been engaged and been provided documents and records by the client, to use these to prepare financial statements, tax returns or other work product for the client. When the accountant learns before delivering the work product, or before returning the client’s documents, that the client is refusing or failing to pay the fee, a natural question might be whether the accountant has the right to either withhold the finished work product (possibly urgently needed by the client) or even to hold onto the client’s own documents and records, as a means of attempting to induce the client to pay. Is this allowable in whole or in part? This paper explores this issue from both legal and an ethical viewpoint, as answered under Texas law and accountant’s ethics rules. It attempts to give guidance on what work product or records can be retained, and which cannot be, and on what circumstances such retention will be permitted considering both legal and ethical requirements.

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