What Is A Bookkeeping Engagement Letter? W Free Templates

Explain what your company does and why you’re writing the letter while clearly stating what bookkeeping services you will provide. This helps organize your engagement letter in a more professional way. Doesn’t have to take up too much space, make sure to stay in only one paragraph for this section. In order to set clear expectations around the services provided, we define what each service consists of in the “Service Terms” section that follows. Setting the billing upfront (whether it’s a flat rate or hourly fees) forces this discussion to take place prior to the project. It drastically increases the chances you will be paid for your services.

• If this letter correctly expresses your understanding, please sign the enclosed copy where indicated and return it to us.
• It is important that the client understands what their responsibilities are as well as the deadlines for completion to ensure the engagement is completed on time.
• By defining which services are included from the outset, you give yourself a contractual out for respectfully saying “no” to work outside the scope of your project.
• Engagement letters are used primarily for filing taxes or audit services for an individual or business entity.
• If circumstances preclude us from issuing an unqualified opinion, we will discuss the reasons with you in advance.
• This section is very important and will clearly define what you will deliver and what work is not included.

I will correct your return for free and pay any penalties if I am at fault. When you are hired as a bookkeeper by a new client, it is important to send an “engagement letter” to your client. This document serves as the guide for your relationship, as it outlines the expectations and responsibilities of both parties during the bookkeeping process. Included is a template letter to use as a guide when you offer your services to a new client.

A Clear & Simple Bookkeeping Engagement Letter – Template

Taking the guesswork out of which responsibilities belong to your firm and which belong to the client lets you focus on the work. For example, if you are handling account receivables for a client, who is responsible for reaching out to delinquent accounts? An engagement letter can cover any type and scope of work depending on how you define and delineate obligations, performance criteria, timelines, warranties of performance, and the like. Identify by name the party responsible for meeting each milestone and deadline. Make sure that you include contingencies for access to the needed information and whatever software tools and systems are required. Then add reasonable turnaround times for the work after the information is provided.

• To add to the objective, it is crucial to be specific in this section of the letter, so there are no misunderstandings between you and your clients.
• Start by clearly stating that this is a bookkeeping engagement letter.
• It should also detail the terms of payment, including when the fees are due, and the interest charges for late payments.

Accountant Retainer Agreement – A full-service agreement outlining payment and any retainer paid by the client. This letter will confirm the terms and limitations of the audit services our firm, [NAME OF FIRM], has agreed to perform for the Client for the year ending [DATE]. You will want to provide two original copies of the engagement letter. You and your client will each sign both copies of the engagement letter. All weekly bookkeeping services will be completed by Wednesday each week unless there is a holiday, in which case all services will be completed by Thursday. Occasionally there is additional software, platform subscriptions, or other expenses which may crop up in an engagement.

Why you need a Bookkeeping Engagement Letter

A recent Deloitte survey clues us in on how you can attract millennials to your accounting firm. But this is exactly the kind of big step forward that moves you toward a scalable accounting firm. PandaDoc serves as a comprehensive solution for accountancy firms seeking user-friendly functionality and efficient document processing. The annual review will be completed within 6 weeks of receiving your financial information. The quarterly services will be completed by the last day of the month following the end of the quarter.

According to investopedia, engagement letters need to be presented to the client at the beginning of the relationship before work commences. Once you and your client have had a verbal agreement to work together, the next step is for you to send them an engagement letter to make things official. These are all important items to include in a bookkeeping engagement letter so that you don’t leave room for any kind of ambiguity or confusion. Our responsibility is to express an opinion on the financial statements based on our audit and is limited to the period covered by our audit.

What is an Engagement Letter?

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Download Template

They are legally binding, and one of the best defensive tools an accountant can possess. You can use different templates for each service you offer and the possibilities online are endless. From the basic Sample Engagement Letter by the AICPA which has worked for years, to more eye-catching templates you can try out from platforms like Ignition or even Canva. As bookkeepers handle sensitive financial information, confidentiality is a key concern.

It is important that the client understands what their responsibilities are as well as the deadlines for completion to ensure the engagement is completed on time. Briefly identify the firm, yourself and your position as well as properly identify who will receive your services, whether that is an individual or a business. You may want to also give a quick company overview to showcase your value and explain the point of the engagement letter.

Your engagement letter should clearly outline the services you will provide, in this case, bookkeeping, payroll, or any related service. First and foremost, your bookkeeping engagement letter should provide the date of the agreement. The sample bookkeeping engagement letter we offer at Financial Cents makes it easier to present a professional image. If you are an accounting or bookkeeping firm owner, you know that it’s vital to impress first-time or potential clients. A client’s first impression of your business could make or break a deal.

What you’ll find in our Bookkeeping Engagement Letter

Sources of sample engagement letters and sample terms and conditions include a CPA’s professional liability carrier, the AICPA (particularly the Tax Section), paid providers, and alliance networks. Leverage samples to help split definition and meaning create engagement letter templates that are best for your firm, services, clients, and risk tolerance. Remember to have an attorney familiar with the laws in your jurisdiction review your templates for enforceability.

While CPA firms can help out with any of these requests, you also need to safeguard your time and get compensated for additional services. To protect yourself from time drains, minimize your professional liability, and maintain your firm’s profitability, you need to ensure you have an engagement agreement in place for each project. Once you’ve drafted up your bookkeeping engagement letter or customized an engagement letter template, you should consult a legal professional in your area to review it and to have your questions answered.