For bookkeepers and bookkeeping teams

A bookkeeping engagement letter that stops the scope drifting

Bookkeeping is the engagement most likely to grow quietly. The letter is where you decide, in advance, what "and could you just…" costs.

A monthly bookkeeping engagement starts as bank reconciliation and payables. Eighteen months later it includes chasing receipts, a sales tax filing, payroll questions and a tidy-up of the two years before you arrived — usually at the original fee.

None of that is the client behaving badly. It is what happens when the only written description of the work is a quote from a year ago. The letter below is written to be specific about the cycle, the volumes, and what falls outside them.

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Bookkeeping engagement letter

The full letter as a PDF, written for the United States, including the volume and clean-up clauses.

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No email required. Or fill one in and we will complete it for you.

What a bookkeeping letter has to pin down

Four things separate a bookkeeping letter that holds from one that gets renegotiated every spring.

1

The cycle, not just the service

Monthly, quarterly, or weekly — and by when. "Monthly bookkeeping" without a closing date is an invitation to send you a shoebox in January for the whole year.
2

Volume, and what happens above it

Transactions, bank accounts, employees on payroll. Firms that price bookkeeping without a volume assumption are pricing a guess. Say what the fee assumes and what a material change triggers.
3

Prior-period clean-up, explicitly excluded

The single most common unpaid work in bookkeeping. Opening balances that do not agree, an unreconciled year, a chart of accounts someone invented. Exclude it, then quote it separately when you find it.
4

Who files what

Be explicit about sales tax, payroll filings and the corporate return: which of them you prepare, which you review, which you file, and which remain entirely the client's.

The bookkeeping engagement letter

Written for United States. The download is the same text as a PDF you can put on your letterhead.

[Firm letterhead]

[Date]

[Client name]
[Client address]

Dear [Client contact],

The engagement

We will maintain the books and records of [Client name] on a [monthly / quarterly] basis, beginning [date]. Each period we will record and categorise transactions, reconcile [number] bank and credit card accounts, maintain accounts payable and receivable, and produce [management accounts / a trial balance] within [number] working days of receiving complete records.

What the fee assumes

The fee below assumes approximately [number] transactions a period, [number] bank accounts, and [number] employees on payroll. If the actual volume differs materially and consistently, we will agree a revised fee with you rather than absorb it or invoice you by surprise.

What is not included

This engagement does not include correcting the records of any period before [date], preparing or filing the corporate return or any personal return, sales tax registration or filing, payroll processing, or advice on accounting systems — unless separately agreed in writing.

If we find that opening balances or prior periods need work before we can proceed, we will stop, tell you what we have found, and quote for it separately.

Your responsibilities

You will provide bank statements, invoices, receipts and payroll information by [day] of each [month / quarter]. You remain responsible for the accuracy and completeness of the underlying records, for authorising payments, and for the final accounts and filings.

Where records arrive late, our timetable moves accordingly and any additional work is charged at [rate].

The limits of this work

This is a bookkeeping engagement. It is not an audit, a review, or a compilation of financial statements, and it will not necessarily detect fraud or error. We perform it in accordance with the AICPA's engagement letter guidance.

Fees

[Amount] in US dollars per [period], invoiced [when], payable within [number] days. Work outside the scope is charged at [rate] per hour and agreed with you first.

Ending the engagement

Either of us may end this engagement on [number] days' written notice. On termination we will provide your records and data in a usable format; our working papers remain ours. Fees for work completed remain payable.

Confidentiality and your data

We keep your information confidential, hold it in accordance with applicable state privacy law, and retain it for [number] years after the engagement ends.

Agreement

Please sign and return a copy.

[Name], [Firm name]

Agreed for [Client name]:

Signature ______________________ Date ____________

Before you use this

Supplied as-is, with no guarantee. These templates are general information, not legal advice, and not a substitute for it. Have your own legal adviser review and adapt one to your practice and your jurisdiction before you put it in front of a client. FirmHello accepts no responsibility or liability for any use made of them.

Where bookkeeping engagements go wrong

The clean-up nobody quoted

Two unreconciled years surface in week three. Without an exclusion the argument is about whether it was implied; with one it is a quote.

Volume creep

The client's business doubles, the transaction count doubles, the fee does not. A stated assumption makes that a conversation rather than a grievance.

The filing nobody owned

A sales tax deadline passes because each side believed the other was handling it. Name the filings and name the owner.

Other engagement letters

What it is Engagement letters Accounting Accounting Tax preparation Tax preparation

Questions bookkeepers ask

Do I need a separate letter for each entity?

Usually yes. Two companies with the same owner are two clients with separate records and separate liabilities. One letter covering both is difficult to enforce and awkward if the relationship with one ends.

How often should a bookkeeping letter be reissued?

Annually for recurring work, and immediately whenever the scope changes materially — a new entity, a payroll, a system migration. The letter should describe the work you are doing now, not the work you were quoted for.

Can I include a price increase clause?

Many firms do: a stated annual review, or an index. What matters is that it is specific enough to apply without a negotiation, and that the client saw it before they signed.

Does this cover compiling financial statements?

No, and that is deliberate. A compilation is a different engagement with its own standard (AR-C 80) and its own wording. Issue a separate letter, or a clearly separate section, for that work.

The letter is the easy half

Sending it, getting it back signed, and finding it again in two years is the half that eats the week. That is what the portal is for.

No card and no sales call. If you would rather tell us about your firm first, use the longer form.