In Pursuit of Profit
Read our expert article below or sign up to get articles sent to your inbox.
When business owners hire third-party accounting firms to manage their finances, they may be provided with an engagement letter. This type of document is new to many business owners, especially those that are outsourcing financial functions for the first time.
Essentially, an accounting engagement letter is an agreement to provide services to a client. The agreement describes the business relationship and sets expectations for both parties in a way that is less formal than a traditional contract.
Business owners frequently wrestle with determining which activities should be outsourced to a freelance bookkeeper or accounting company. Budgetary restrictions can limit a company’s ability to outsource financial tasks, as can concerns over delegating duties. In these instances, it often makes sense to offload tasks that will have the greatest ROI first, and then include others later as means allow.