Engagement Letters Book

[geekgirldany]

I hope the mods don't mind me posting this.

I recently received a engagement letters book. A CPA's Guide To Effective Engagement Letters.

I know there has been several posts in the past about engagement letters. Let me tell you this book covers it all. Tax prep, consultation, bookkeeping, payroll, etc. Very detailed book and even has the letters on CD. Although it is prepared with the CPA in mind alot of sections can be removed or CPA changed to the correct designation.

I got the book at CCH it was around $130.00. Definately worth it. Some of the letters are very long and do need to be cut down at bit. I will be using this with most bookkeeping and payroll customers. Like I said I will shorten them as they seem like contracts. Which I guess they should.

Also I am going to stop telling people that I have to get them signed for insurance purposes. The customer that is currently going under an audit... the auditor made a mistake saying there was alot of income not reported. It was reported. But the client did threaten to go after my insurance company for any penalities or after me period. Good people who I never though would do that. Just shows ya. But I did have an engagement letter in place thankfully.

[Chief]

GeekGirlDandy

This post shows that we live in a world of people ready to file a lawsuit at the drop of a hat. Telling your clients the engagement letter was for insurance purposes was not wise as you found out. I tell my clients that the engagement letter simply says that the information given me is true to the best of your knowledge. In case of questions that might come up, the client is responsible for providing proof of information given to me. So far I have never had anyone refuse to sign the engagement letter. If I did,I would simply say I cannot prepare your return.In my advertising somewhere I state that I may decline to do a return for any reason that I choose.

[geekgirldany]

yes you are right it was a huge mistake for me to say that. I now tell them it is protect them as well as me. And that it says the info they are giving me they are responsible for. I make sure they read it and give them copies. Alot of them will ask if there is a copy included.

[Armando Beaujolais]

Make Lemonade

If you approach your clients with an attitude like "I hate to have to make you do this, but you have to sign this disclaimer," they're not going to be thrilled about it.

I approach it from a standpoint that it's clarification of what they're hiring me to do. It explains what they have a right to expect from me. It explains services, fee structure, and liability. I give the example of court cases where a tax preparer gets sued because a client claims they thought they were doing an audit. That tells the clients why it's important and not just another piece of worthless paper to sign. It also gives you a chance to educate your client on what you really do. Most clients think you drop all their papers into a hopper, push the "Prepare" button on your computer, then a completed return pops out. They have no idea what goes on behind the scenes. I present the engagement letter as a value-added feature, and I sign it also to indicate the two-way-street aspect.

[Gretel]

Engagement Letter

I sign my Engagement Letters too. With simple returns I always have a problem having them sign it. Somehow it feels like throwing bombs on sparrows. My policy is to have all clients sign an Engagement Letter and my Privacy Statement is right on it.

So I made it easy for me because I am required to give my Privacy Statement to my clients each year. HaHa.

[geekgirldany]

Too Nice, ME

I'm just too nice to people. That is about what I said "I hate to have to make you do this, but you have to sign this disclaimer". Some of them said "do you not trust me". I had to explain its not about trust its about explaining what services I do provide. It is a two way street and I also sign all my engagement letters also.

I read a case regarding engagement letters. A firm had a client sign a engagement letter at the beginning of their business relationship. But they did not get them to sign on each year. They provided tax advice and prepared his tax returns. Well 10 years went by and the client got audited. There was something found wrong with the bookkeeping and the client blamed the accounting firm. They said they had an engagement letter that stated they were not responsible and claimed it was for the whole business relationship. Court found that a letter should have been filled out every year. The firm's liability insurance settled with the customer.