Question

SECTION B (15 marks)
A prospective client (none of the partners know him) has enquired as to whether we will look
after a large sum of money he is expecting to receive shortly. He informs us that he is going on a
nine month hike across Kilimanjaro and will not be able to look after these funds himself. He
says that the money will be transferred to the firm’s bank account on 31 October and that we can
invest it “as we see fit”. The fee he is offering is very, very generous.

REQUIRED:
Can you advise us of any Code of Professional Conduct requirements we should be aware of?
(15 marks)

Answer 1

ANS:

In that case you should refer the "Code of Ethics"

A.10. Fees and Business Practices

A.10.a. Self-Referral Counselors working in an organization (e.g., school, agency, institution) that provides counseling services do not refer clients to their private practice unless the policies of a particular organization make explicit provisions for self-referrals. In such instances, the clients must be informed of other options open to them should they seek private counseling services.

A.10.b. Unacceptable Business Practices Counselors do not participate in fee splitting, nor do they give or receive commissions, rebates, or any other form of remuneration when referring clients for professional services.

A.10.c. Establishing Fees In establishing fees for professional counseling services, counselors consider the financial status of clients and locality. If a counselor’s usual fees create undue hardship for the client, the counselor may adjust fees, when legally permissible, or assist the client in locating comparable, affordable services.

A.10.d. Nonpayment of Fees If counselors intend to use collection agencies or take legal measures to collect fees from clients who do not pay for services as agreed upon, they include such information in their informed consent documents and also inform clients in a timely fashion of intended actions and offer clients the opportunity to make payment.

A.10.e. Bartering Counselors may barter only if the bartering does not result in exploitation or harm, if the client requests it, and if such arrangements are an accepted practice among professionals in the community. Counselors consider the cultural implications of bartering and discuss relevant concerns with clients and document such agreements in a clear written contract.

A.10.f. Receiving Gifts Counselors understand the challenges of accepting gifts from clients and recognize that in some cultures, small gifts are a token of respect and gratitude. When determining whether to accept a gift from clients, counselors take into account the therapeutic relationship, the monetary value of the gift, the client’s motivation for giving the gift, and the counselor’s motivation for wanting to accept or decline the gift.

Preventive Actions:

1. I would make sure that you run business credit searches on both new and existing clients that you sell to. This will help give you an understanding of how your clients are paying their vendors. More often than not, if you see that clients pay slow or don't pay at all, they are going to do the same to you. I would conduct an annual or bi-annual audit of your customers to make sure that their credit reports have not deteriorated, which in turn puts you at risk.

2. New customers should be COD! Unless you have a contract and are selling to a reputable company, then new customers shouldn't be given terms until they show some sort of payment history. This is a beneficial way to test the waters without putting your company at risk.

Now, when it comes to getting existing customers to pay faster, that's always a challenge. It's hard to ever truly know why a client isn't paying on time. One thing I try to do is remember that my client is a human as well. It sounds elementary, but relating to your client can be the breakthrough you need to get paid faster.

Hope this was helpful!