Tips for Writing a Bookkeeping Engagement Letter for Your Business

engagement letter for bookkeeping and payroll services

This part of the engagement letter is included to protect the client and assure them you want to maintain the confidentiality of their books and finances. Though this part does not directly benefit the bookkeeper, it’s important to state you intend to protect the client’s data. However, it is the day-to-day accounting for revenue and expenses to enter into a system such as QuickBooks that I want a bookkeeper to do. I simply enter all of the data into a spreadsheet, match it with my receipts, and send it to a bookkeeper to complete. You can send your documents to a secure vault that many bookkeepers and accountants have.

What is a letter of engagement in financial planning?

The letter of engagement for financial planning is a written, legally binding contract that outlines, in clear terms, the business relationship between the client and financial planner. It sets expectations for the partnership.

To act as a taxpayer’s representative, the accountant must be a CPA, registered tax agent, or attorney. Our expectations of you are to provide all documentation in an accurate and clear manner. If you have any questions about your case, you should contact him/her directly. Should I encounter instances of unclear tax law, or of potential conflicts in the interpretation of the law, I will outline the reasonable courses of action and the risks and consequences of each.


Outline what the engagement is and when it will begin and end, and expected delivery dates of the work performed. This can be simply stating the date range of the engagement, or you can include a detailed breakdown of deadlines for both you and your client to keep the project on track. To affirm that this letter correctly summarizes your understanding of the arrangements for this work, please sign the enclosed copy of this letter in the space indicated and return it to me in the envelope provided, or electronically. This Agreement, and the rights and obligations of the Parties hereunder, shall be governed by and construed in accordance with the laws located in the State where the services are being provided. Our responsibility in this engagement consists of completing the bookkeeping activities outlined above with care and due diligence.

engagement letter for bookkeeping and payroll services

You also agree to provide us with a copy of the final reproduced material for our approval before it is distributed. The financial statements are the responsibility of the Company management. Management is also responsible for making all financial records and related information available to us. Accountants and bookkeepers are often required to have a signed engagement letter by all their clients before they can begin work as required by their professional liability insurance.

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In the event of a dispute, you and we agree that the courts of the state of California shall have jurisdiction, and we agree to submit all disputes to the courts of San Mateo County, which is the proper and most convenient venue for resolution. We also agree that the law of the state of California shall govern all such disputes. All information you provide to us in connection with this engagement will be maintained by us on a strictly confidential basis.

Check processing and tax payments will also be performed correctly and in a timely manner. You may, within the time permitted for our firm to respond to any request, initiate such legal action as you deem appropriate, at your sole expense, to attempt to limit discovery. If you take no action within the time permitted for us to respond, or if your action does not result in a judicial order protecting us from supplying requested information, we may construe your inaction or failure as consent to comply with the request. Engagement letters define the working relationship between a firm and their clients. They are an up-front way to show your professionalism and how you prefer to conduct business.

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You are responsible for complying with all applicable laws and regulations pertaining to such operations, including the classification of workers as employees or independent contractors and related payroll tax and withholding requirements. If we are not a party to the proceeding in which the information is sought, you agree to reimburse us for our professional time and expenses, as well as the fees and expenses of our legal counsel, incurred in responding to such requests. Workpapers and other documents created by us are our property and will remain in our control. Copies are not to be distributed without your written request and our prior written consent. Our workpapers will be maintained by us in accordance with our firm’s record retention policy and any applicable legal and regulatory requirements. We will bill you for our professional fees and out-of-pocket costs either at the end of each month for hourly services provided or twice monthly on the 15th and end of each month, and at the beginning of each month for flat fee services.

  • An engagement letter is a contract to outline the service terms between the service provider and client.
  • You need to be specific about exactly what the client is responsible for doing.
  • As long as you have delivered the services outlined in your engagement letter, you’ll have a strong argument.
  • The Accountant/Bookkeeper shall have no rights to assign any of their rights under this Letter or delegate the performance of any of the obligations or duties hereunder, without the prior written consent of the Client.

The engagement letter should include wording for who is responsible for these additional expenses. We appreciate the opportunity of providing you with a proposal for Bookkeeping and Consulting Services. To ensure a complete understanding between us, this letter will describe the scope and limitations of the services we will provide bookkeeping and payroll for you. You need a computer with bookkeeping software such as QuickBooks and an internet connection. Many small bookkeeping businesses obtain most of their clients by referral. These businesses often network with other small bookkeeping businesses for referral when they or their referral become too busy to handle more clients.

Friedman, Saiyed & Ellis, CPAs, LLP

The engagement letter, including this Terms and Conditions Addendum and any other attachments, encompasses the entire agreement of the parties and supersedes all previous understandings and agreements between the parties, whether oral or written. Any modification to the terms of this Agreement must be made in writing and signed by both parties. If you realized income, loss or expense from a business or supplemental income or loss, the reporting requirements of federal and state income tax authorities apply to such income, loss or expense.

  • If you provide our firm with copies of brokerage (or investment advisory) statements and/or read-only access to your accounts, we will use the information solely for the purpose described in the Engagement Objective and Scope section of the engagement letter.
  • Other examples of responsibilities which should be defined include gathering statements, interacting with the client’s CPA, and handling financial matters.
  • Any costs for legal representation shall be borne by the hiring party.
  • While each of these items is relatively small and doesn’t take a lot of additional time, you need to consider the long-term implications for how much additional time it will take you each month or year.
  • All reports, templates, manuals, forms, checklists, questionnaires, letters, agreements and other documents which we make available to you are confidential and proprietary to us.
  • Certification requirements vary depending on the jurisdiction, and generally include work experience, training, and a bachelor’s degree.

You can refer back to this letter if the client asks you to do something that is not on it. Then, you have the right to say no, or ask for more money for the extra service. In the engagement letter, you’ll need to describe the services you will offer. These may include budgeting, accounts receivable, accounts payable, and/or advisory services.

Identification of the parties

If we receive a request for copies of selected workpapers, provided that we are not prohibited from doing so by applicable laws or regulations, we agree to inform you of such request as soon as practicable. You may, within the time permitted for our firm to respond to any request, initiate such legal action as you deem appropriate, at your sole expense, to attempt to limit the disclosure of information. We reserve the right to suspend or terminate our work for non-payment of fees. In addition to the Fees provided in Section III, the Client agrees to reimburse the Accountant/Bookkeeper for any out-of-pocket expenses incurred that include, but are not limited to, travel expenses, audit fees, tax fees, and postage. You or WCG (formerly Watson CPA Group) may cancel this engagement at any time by any form of written or electronic notice.

engagement letter for bookkeeping and payroll services