Letter of engagement

MTJR Registered Posts: 29 Regular contributor ⭐

I've very recently become an AAT licensed accountant and i'm getting ready to prepare my first letter of engagement. I've just read through the AAT templates, which are slightly overwhelming. I have a few questions -
The covering letter template says it's for "taxation services" and "Thank you for engaging us as your tax practitioners", would i change this if, for example, i was doing general bookkeeping, year end accounts, and partnership tax for a client? and would it just be the one covering letter, and then separate Schedules of Services?
Also, there isn't a template for general bookkeeping (i.e entering invoices/receipts into cloud software etc.) Would i just put the cost of those in the covering letter, without it's own schedule of service?

Thanks :)


  • Caspar1
    Caspar1 Registered Posts: 29

    (I am sure you have already seen this, but thought I would pick out a few pointers that might help within).............
    If at AAT.Org.UK, you log in and look under the Professional Zone, you can look at Letters of Engagement for the Licensed Accountant. When there click into this top one and it downloads the document to your PC. Page 45 talks of sole traders and property income. Point three says this.....

    3. We will complete the writing up of your books and records in so far as they are incomplete when presented to us. These will be from the accounting information and records you supply.

    Point 4 talks about not carrying out an audit or verifying what has been supplied as these are their responsibility etc.

    So this section would form part of your Book Keeping Schedule and you could create a book keeping schedule from it.

    You can update the wording to include the particular software you are using (provided by them or you), and I would include this as a schedule. In the main letter, you would state under the services you will be providing, book keeping at £x per hour or £x per month whatever you are charging.

    If you look again at this main document, page 4 point 4 mentions that you can tailor the schedules/letters to meet individual circumstances. For example point 5 mentions that in the future should your fee change, the covering letter can be sent again to notify of a change of fees and changes to the T&C's (which will replace the earlier one), but at that time, it won't be necessary to include all the documents again.

    Hope that is of some help.

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  • MTJR
    MTJR Registered Posts: 29 Regular contributor ⭐
    Thank you, that's very helpful :)
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