Professional Clearance Letters: What to Send the Outgoing Auditor, and How Long to Wait
What the IESBA Code requires when you replace another auditor, a professional clearance letter template and a reply template, what to do when no reply comes, and what to record.
Short answer: Before you accept an audit or review from another firm, the IESBA Code requires you to ask the existing or predecessor accountant for any facts you need to know before deciding. Get the client's written permission first, send a short letter, and wait the period your local rules or firm policy set. If no reply comes, take other reasonable steps, record what you did, and decide.
This guide is for partners, managers and practice administrators at audit, tax and accounting firms taking over an audit from another firm, and for outgoing auditors who need to reply. In Kenya the step is usually called professional clearance; elsewhere it is often called a change of auditors or communication with the predecessor auditor. The requirement is the same.
Creodata sells practice software for audit firms, so we say plainly where we fit near the end. This is practical guidance, not professional or legal advice: check the current IESBA Code, your institute's rules and your firm's own policies.
What the IESBA Code requires
The requirements sit in Section 320 of the IESBA International Code of Ethics for Professional Accountants, "Professional Appointments". The paragraph numbers below are the same in the 2024 and 2025 editions of the Code.
| Paragraph | What it says, in short |
|---|---|
| R320.4 | Before replacing another accountant, or tendering for their engagement, determine whether there are any reasons not to accept |
| 320.4 A4 | Safeguards include asking the existing or predecessor accountant for any known information you need, and background inquiries about senior management and those charged with governance |
| 320.5 A1 | You will usually need the client's permission, preferably in writing, to start discussions with the existing or predecessor accountant |
| R320.6 | If you cannot communicate with them, take other reasonable steps to obtain information about possible threats |
| R320.7 | An accountant asked to respond must comply with the laws governing the request and give any information honestly and unambiguously |
| R320.8 | For an audit or review of financial statements, you must request the existing or predecessor accountant to provide known information you need before deciding whether to accept |
| R320.8(b) | If the client fails or refuses to let the predecessor discuss its affairs, the predecessor must tell you, and you must carefully consider that when deciding |
| R360.22 | A predecessor who withdrew over non-compliance with laws and regulations must, on request, give you the relevant facts even without the client's permission, unless the law prohibits it |
R320.8 turns the request from good practice into a requirement for audits and reviews. Two points are often missed. First, the Code asks for the request; it does not require a reply before you can accept. Second, the Code sets no waiting period; unless local rules set one, it is your firm's policy.
The auditing standards point the same way. ISA 300 requires the auditor, before starting an initial audit, to communicate with the predecessor auditor where there has been a change of auditors, in compliance with relevant ethical requirements (para 13(b)). ISQM 1 lists inquiry of existing or previous providers as a source of information for accepting a new client (para A69) and names the reasons for the change of auditor as a factor to consider (para A68).
By country. Tanzania is the one East African market where we have found a response period set in the rules. Under by-law 20 of NBAA's Accountants and Auditors (Practising) By-Laws, 2023 (GN No. 487), a predecessor auditor asked in writing must give the successor access to relevant information held about its audit work, to be used for the audit only. If the predecessor fails to respond within fourteen days of receiving the request, the successor may accept or reject the engagement on its professional judgement.
In Kenya, ICPAK requires its members to follow the latest IESBA Code, and the 2025 edition is in use. We found no ICPAK pronouncement that uses the term "professional clearance" or sets a response period, so treat any period you have heard quoted as a firm's policy, not a rule. ICPAU in Uganda and ICPAR in Rwanda have also adopted the IESBA Code, so Section 320 applies there; check your institute's own guidance for anything it adds.
Step 1: get the client's permission in writing
The predecessor is bound by confidentiality (320.7 A1) and can usually only speak to you if the client allows it. So the first letter is not to the predecessor; it is to the client, or a paragraph in your acceptance correspondence, asking the client to:
- authorise you to contact the outgoing auditor;
- authorise the outgoing auditor, in writing, to answer you fully; and
- where you will need them, authorise access to the outgoing auditor's working papers for opening balances.
Send the client's authority with your letter, or ask the client to send it direct. If the client will not give permission, that refusal is itself a fact to weigh under R320.8(b).
Step 2: what the clearance letter asks
The letter should:
- Say that you have been invited to accept appointment as auditor (or to tender) and for which entity and period.
- Confirm that the client has given permission, and enclose it.
- Ask whether there are any professional or other reasons, or any facts, you should know before deciding whether to accept.
- Ask for a reply by a stated date.
- If needed later, ask whether the outgoing auditor will give access to working papers, since ISA 300 lists arrangements with the predecessor to review their working papers as a planning matter for an initial audit (para A24).
You are asking for facts, not the predecessor's goodwill or views on the fee.
Template: professional clearance letter
Copy, then adapt it to your firm's letterhead and policy.
[Your firm's letterhead]
[Date]
The Engagement Partner [Outgoing audit firm] [Address / email]
Dear [Name],
[Client name] – audit of the financial statements for the year ending [date]
We have been invited by [client name] to accept appointment as auditors for the year ending [date] [or: to submit a proposal for the audit]. We understand that your firm is the existing auditor.
[Client name] has authorised us to contact you and has authorised you to discuss its affairs with us. A copy of that authority is enclosed.
Before we decide whether to accept the appointment, we would be grateful if you would tell us of any facts or other information of which, in your opinion, we should be aware, including any professional reasons why we should not accept.
We would appreciate your reply by [date]. If we do not hear from you by then, we will follow our firm's procedures and proceed on the basis of the information available to us.
If we accept, we may also ask to review your working papers for the prior year for the purpose of our work on opening balances, and would be grateful to know whether that will be possible.
Yours sincerely,
[Name] Engagement Partner, [Firm] [Practising number, where your institute requires it]
Enclosure: client's authority dated [date]
Send it by a route that gives proof of delivery: email with delivery confirmation, courier, or hand delivery against a signature.
Template: reply from the outgoing auditor
If you are the outgoing auditor, check the client's authority, then reply promptly, honestly and unambiguously (R320.7).
[Outgoing firm's letterhead]
[Date]
[Incoming firm and address]
Dear [Name],
[Client name] – your letter of [date]
Thank you for your letter of [date]. We confirm that [client name] has authorised us to discuss its affairs with you.
Either: We are not aware of any facts or other information of which, in our opinion, you need to be aware before deciding whether to accept the appointment.
Or: We draw your attention to the following matters: [state the facts plainly, for example disagreements with management, limitations on scope, or the circumstances of our resignation].
Or, where the client has not given permission: [Client name] has not given us permission to discuss its affairs with you.
[Optional:] Subject to the client's consent and our usual terms, we will make our working papers for the year ended [date] available for your review.
Yours sincerely,
[Name], Engagement Partner, [Firm]
If you withdrew because of non-compliance or suspected non-compliance with laws and regulations, R360.22 applies: you must give the relevant facts on request, even without the client's permission, unless the law prohibits it.
How long to wait, and what to do when no reply comes
The Code does not say. In Tanzania, the NBAA by-laws give the predecessor fourteen days from receiving the request before you may decide without a reply. Elsewhere, firms set a period in their quality management policies, commonly measured in days rather than weeks, long enough for a busy partner to reply and short enough not to hold up the client's timetable. Whatever you choose, write it down, make sure it is no shorter than any period your local rules set, and apply it to every engagement.
When the period runs out with no reply:
- Chase once, in writing, and by phone if you can. Confirm you have the right address and partner.
- Take other reasonable steps (R320.6): background searches on the owners, management and those charged with governance; inquiries of third parties such as bankers or legal counsel (320.4 A4; ISQM 1 para A69); and the entity's public filings.
- Ask the client why the auditor is changing, and record the answer. ISQM 1 names the reasons for the change as a factor bearing on the client's integrity (para A68).
- Record the decision. Note the date of the letter, proof of delivery, the chaser, the other steps taken, what they showed, and who decided to proceed.
- Proceed or decline according to your policy. Silence is not a clearance, but under the Code it is not a bar either, provided you took the other reasonable steps and can show it.
If a reply arrives after you have accepted and raises something that would have made you decline, ISA 220 (Revised) requires the engagement partner to communicate it promptly to the firm (para 24).
What to record
An inspector reviewing the file will want to see the whole sequence, not just the letter.
| Record | Why it matters |
|---|---|
| Client's written permission, dated | 320.5 A1; shows the predecessor could lawfully reply |
| The clearance letter as sent, with the date | R320.8: the request was made |
| Proof of delivery | Shows the request reached the right person |
| The reply date the letter asked for, and the firm's waiting period | Shows the wait followed policy, not convenience |
| Chasers sent, with dates | Shows reasonable effort before proceeding |
| The reply, or a note that none came | Either closes the step or triggers R320.6 |
| Other reasonable steps taken and their results | R320.6 and 320.4 A4 |
| The acceptance decision, who made it and when | ISA 220 (Revised) para 22; ISQM 1 para 30 |
| Arrangements for access to prior-year working papers | ISA 300 para A24; opening balances |
Where Creodata fits
Creodata is a Nairobi software company. AuditEDMS, our practice software for audit firms, runs each statutory audit as a sequence of stages from tender to archive, and professional clearance is one of them. It comes after the entry meeting and client acceptance and before the engagement letter, and stages complete in order, so the engagement letter cannot be completed until clearance is completed or skipped, for example for a first audit. That places acceptance after the predecessor has been asked, consistent with R320.8. The clearance stage is a timer: it waits the period your firm sets (14 days by default, the same period as Tanzania's by-laws, and changed in the settings, not in code) and closes early only when the outgoing auditor's reply is recorded against it. The letter, the client's authority and the reply are filed in your own SharePoint against the client and the engagement, with who filed them and when, and every action goes to an audit trail. The engagement prints as a compliance view showing each stage, its evidence, its dates and who completed it, which is the record an inspector asks for.
AuditEDMS does not write the letter or decide whether to accept; your partners do. It works alongside your working-paper software rather than replacing it. See AuditEDMS for audit firms for the rest of the engagement lifecycle.
Frequently asked questions
Is a professional clearance letter a legal requirement?
For members of institutes that have adopted the IESBA Code, the request to the existing or predecessor accountant is an ethical requirement for audits and reviews (R320.8), and ISA 300 requires communication with the predecessor before an initial audit. Company law in some countries adds its own rules on changing auditors; check yours.
How long should I wait for a reply?
The IESBA Code sets no period, and we found no ICPAK rule that does. In Tanzania, NBAA's 2023 practising by-laws let you decide without a reply once fourteen days have passed from the predecessor's receipt of your written request. Elsewhere, set a period in your firm's policy, state the reply date in the letter, and apply it consistently.
What if the client refuses permission?
The predecessor must tell you that permission was refused, and you must carefully consider the refusal when deciding whether to accept (R320.8(b)). Many firms treat an unexplained refusal as a serious warning sign.
See how AuditEDMS for audit firms runs the clearance stage, and the rest of the audit from tender to archive: request a pilot.