Accounting Engagement Letters: A Scope and Handoff Checklist

An engagement letter turns a conversation about services into a shared record of what the firm and client have agreed. The AICPA and CIMA guidance describes it as a contractual agreement tailored to the client, covering scope, duration and sometimes fees or rates. That is a useful starting point; the final terms need review under the applicable professional standards and law.

Questions to settle before drafting

Begin with the service itself. What work is included? Which period, entities and deliverables are covered? What is outside scope? Who at the firm can accept a change? If a client later asks for additional tax planning, payroll or advisory work, the team should know whether that request needs a new agreement.

Clarify both sides' responsibilities. The client may need to provide records, answer questions, review drafts and make decisions. The firm should name its deliverables, review process and communication contact. Agree on target dates only after identifying the inputs and approvals on which they depend.

Discuss the commercial and operational terms with the appropriate adviser: fees or fee method, billing timing, additional work, confidentiality, document access, retention, termination and dispute handling. These terms vary by service and jurisdiction. A checklist can prepare the discussion, but a qualified professional must settle the actual contract language.

Make the agreement usable in delivery

Once the appropriate people approve and sign the letter, translate its scope into a delivery brief. Record the service owner, client contact, first document request, key checkpoints and where the signed version can be found. If the scope changes, record the decision through the firm's agreed approval process before expanding the work. A task list cannot silently amend a contract.

Illustrative example: a client engaged a firm to prepare one entity's annual return. Midway through, the client asks for a second entity and a forecast. The delivery owner records the request, confirms that it is outside the agreed scope, and routes it to the person authorized to discuss additional terms. The team does not treat the new work as approved merely because it appeared in an email.

Use this checklist to prepare a conversation with a qualified professional, not as legal advice or a substitute for an engagement letter. Clienter can help a service team organize tasks and document requests around an engagement; see the current platform overview if that coordination is the problem you need to solve.