You have been speaking with prospective client and s/he has expressed interest in working with you. While the conversation you have had with the client was about the challenges s/he is facing and how s/he would like to keep business bookkeeping and accounting clean. You have been able to convince him/her that you have capabilities and process to streamline the bookkeeping accounting process for its business.

Both, you and client are eager to get started with the work.

But wait, have you agreed to what exactly ‘the work’ is going to be and how it will be done, when it will be carried out, under what circumstances/conditions? Who will provide invoices, bills, when will those be provided, what is the frequency, what is the fee, when will your fees be paid, etc?

In short, you will need an engagement letter signed by both parties (you and your client) before you can commence actual work.

 

Essentials of a bookkeeping engagement letter

This blog post will briefly look at what a bookkeeping engagement letter is, why is essential for bookkeeping firms, and the important terms/aspects/points to include in the engagement letter. A good bookkeeping engagement letter ensures that both you and your client have a common understanding and it protects both parties as per the terms agreed in it.

What is it?

A bookkeeping engagement letter outlines the specific bookkeeping services you will provide. It is important for you and your clients to agree on the terms of your service engagement. The bookkeeping engagement letter will clearly identify the responsibilities of each party involved, schedule of services, fees to be paid. The bookkeeping engagement letter becomes very crucial when things do not go as planned or agreed.

Why is it necessary?

Convincing, precise and error-free engagement letters are crucial for you and your firm. It should clearly state the work practices and framework your firm offers and make your clients aware of the scope of services.

Effective engagement letters not only avoid misrepresentations, misunderstanding or assumptions based business dispute but it also protects you & clients from legal hassle.

The scope of your accounting and consulting services needs to be correctly conveyed, convincingly presented, and the best way to do that is through Fresh Proposals software.

Want to know more about it? Please go through more information what is an engagement letter, why engagement letter is important and what information should it include, etc.

How to write bookkeeping engagement letter

Ready for it? Let’s go

In order to create & send engagement letter using Fresh Proposals, we recommend use of templates. The reason is: reusability, save time, avoid mistakes, higher chances of conversion. Once you have an engagement template ready, you can use it again and again. You can also improvise whenever you feel like.

Do you use a bookkeeping services agreement?

Do you have a already written bookkeeping service agreement? Great. Is it in a digital format like Word/ Google Doc or PDF file format?

You can copy its content to a document in Fresh Proposals. In fact, PDF file can be imported to the document as well.

If you haven’t used engagement letter before and do not have agreement document for your services, we suggest you to seek legal advise, consult legal expert and also check with the professional bodies such as AICPA, NATPTAX, CIOT, TTI, AIBP, ICB USA or insurance provider and refer their guidelines for client-engagement so that your engagement letter covers terms and conditions which will help you protect your bookkeeping practice from known/unknown risks.

Now let’s say you have your own terms of engagement document and you have uploaded to Fresh Proposals content library as a section.

If you have added terms and conditions to Fresh Proposals, let’s head over to Sections Library

 

You can use these sections as it is or keep updating from one client to another. It is totally up to you.

Use bookkeeping engagement letter template

If you prefer to use your own format of the engagement letter and upload it as section to Fresh Proposals, that’s fine. You can always create bookkeeping engagement letter sample from the scratch. You may want to take a look at examples of the engagement letters templates available in Fresh Proposals software. These templates are made available as pre-designed but 100% customizable. You can update every bit of the content on the page.

Once you have previewed the list of engagement letter templates and decided to use one of those (like shown below)

You can preview the engagement letter templates in terms of layout, its content by clicking on Preview button.

Update content, customize template

You can customize the engagement letter document completely – for the its content as well as design. You can add/ update/ delete sections (more about it. below)

You can add new sections, update or delete existing ones, reorder as you may feel right.

 

Include important elements of the engagement letter

As mentioned above, you can include existing section from the library to your current template. You will need to click on the plus button on the top-left side to add section / open section library options. You can scroll through the list of sections or search from the list of sections available in the library.

The important sections you should include in your bookkeeping engagement letter are

Cover letter : Identify ‘client’ and ‘service provider’

Schedule of bookkeeping services

Responsibilities of each party

Timeline for submission, process of accounting data

Engagement fees

Payment terms & schedule

Terms & condition of the services

Engagement fees

The one of the best things about Fresh Proposals software is, you can include interactive three tiered pricing in your engagement letter. By interactive, we mean, clients can select-deselect, change quantity, select-deselect optional items, use discount, taxes..

Assign & use eSignatures

Use of e Signature is common these days. It helps you close proposals, engagement letters, contracts faster. In most part of the world, documents signed using eSignatures are legally binding. eSignature just makes the whole process so much simpler and faster, even for your clients.

Use and update dynamic fields/ Variables

One typical mistakes happen when using Google Doc or MS Word template is, previous client information is copied to the next document, you end-up-sending stale or document with incorrect information. You need to find and replace those references one by one.

Use of placeholder/ variables in Fresh Proposals software, helps you avoid such mistakes.In fact, once you use placeholder or variable e.g. for addressing client, you don’t even have to worry about replacing it. The software ensures current client details are correctly used wherever appropriate placeholder variables are used

Fresh Proposals software highlights placeholder variables with yellow background to the text when you are in the editor. It displays value of the placeholder variable if it is available. To replace one variable with another, simply double click on the variable (text with yellow background).

 

Use it for your advantages

Our users including those in accounting, bookkeeping, tax practices are able to create proposals using pre-made as well as customized template. We noticed, many of these engagement letters created from template are sent within few minutes after they are created and signed by the engagement letter.

It shows the time to create and send engagement letters has gone down drastically, as brief as 5 minutes.

Do you know that Fresh Proposals is recognized as high performer proposal software by G2 review platform?

What are you waiting for? Try Fresh Proposals to save your valuable time and onboard more clients.