Accountant / Bookkeeping Engagement Letter

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An accountant / bookkeeping engagement letter outlines the scope of work to be provided to a client including compensation and the timeline for when it will be complete. Engagement letters are used primarily for filing taxes or audit services for an individual or business entity. 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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How to Hire an Accountant

To hire an accountant a simple agreement must be drafted that outlines the pay and scope of work provided. Due to the accountant having access to financial accounts, it’s highly recommended to use someone that is recommended by friends or family in order to know the person being hired is trustworthy.

Step 1 – Decide the Type of Accountant

In most cases, the client will be looking for a simple tax filing accountant to handle end of year records. Although, there are ten (10) types of accountants to choose from:

  1. Tax Accountant
  2. Auditor
  3. Financial Advisor
  4. Project Accountant
  5. Staff Accountant
  6. Forensic Accountant
  7. Investment Accountant
  8. Cost Accountant
  9. Management Accountant
  10. Government Accountant

Step 2 – Ask Around

The best way to find a qualified accountant is to speak with friends, family, colleagues, and your attorney. An accountant will have access to all financial records and be responsible for filing taxes and organizing your financials. Therefore, it’s highly recommended to find someone trustworthy and proficient in their services.

Step 3 – Search Online

If no one is recommended then it’s best to use qualified and reviewed accountants from the following websites:

Step 4 – Meet and Negotiate

After finding an accountant that meets your needs, it’s best to have a meeting and negotiate the services and the price. The accountant will usually charge an hourly rate ($/hr) and in some cases will give a price for the entire project.

  • Average Pay
    • Hourly Rate: $33.89/hour (source: BLS)
    • Salary: $70,500/year (source: BLS)

Step 5 – Sign an Engagement Letter

Download: Adobe PDF, Microsoft Word (.docx), Open Document Text (.odt)

In order for the accountant to begin work, an agreement must be signed by the client. This is to protect both parties and most often required by the accountant’s professional liability insurance. Once the engagement letter is authorized, the accountant may proceed to provide services to the client.

Sample Engagement Letters (3)

Sample – Audit Engagement Letter

Download: Adobe PDF

Sample – Tax (Filing) Engagement Letter

Download: Adobe PDF

Sample – Standard Engagement Letter

Download: Adobe PDF

Related Agreements

Accountant Retainer Agreement – A full-service agreement outlining payment and any retainer paid by the client.

Bookkeeping Services Agreement – For a bookkeeper to provide general services related to organizing and submitting financial records.