Holiday Motels Ltd is a chain of ten motels operating on the far south coast of WA. Your firm performs both audit and tax work for Holiday Motels. The audit fees comprise around 10% of total audit fee revenue, while the tax work comprises around 5% of total tax related revenue. Holiday Motels has not paid any of its fees for the last three years, citing cash flow problems. However, in actual fact, Holiday Motels has made impressive profits over the last few years and has significant cash reserves. The partners have been reluctant to push the issue further, as Holiday Motels is a high profile client who they wish to retain. Last month, your firm agreed to hold their annual staff retreat at one of Holiday Motels new motels, as a partial contra against the outstanding fees. Half of the outstanding fees will be waived, even though the reasonable market value of the services to be provided is only 30% of the total outstanding amount.

identify any professional standards and regulatory requirements which have been breached and explain the impact of the breaches.