audit engagement letter

Audit engagement letter

How do you write an audit engagement letter? Check out this Audit engagement letter template now for your reference when accepting an audit.

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Acceptance Letters
LANGUAGE::
English
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.docx (0.01 MB)

Overview

The audit engagement letter should enumerate the related deliverables for the audit, including an evaluation of internal controls, and the preparation of the audit report and opinion letter at the conclusion of the engagement. 

How do you write an audit engagement letter?

An engagement letter for auditing serves summarizes the contract in an easier-to-understand way for both the client and the auditor. In such a letter, the following is mentioned:

  • the scope of work to be performed,
  • the timeline in which it will be provided,
  • the professional fee structure,
  • and the limitations of the engagement.

It is a professional way to make sure both parties involved understand what is expected. From the provider's side, it summarizes professional services that are delivered when the audit is performed. Often it’s sent by lawyers and CPAs, to establish a relationship with a client, define the terms during the length of the relationship, and detail the work to be done. For the client, it's important to confirm they can accept the terms and conditions that are defined by the service provider and the client. 

Consequently, it is important to properly document the agreement for services prior to starting work on an audit.

The following needs to be explained:

  1. Identify the scope of services to be rendered;
  2. Establish the timeline for performing audit and related fieldwork for scheduling purposes;
  3. Mention audit-related regulatory deadlines;
  4. Clearly establish the professional fee structure (estimate of the total fees and costs, as well as specific provisions for travel and other direct cost reimbursements). 
  5. Disclaim any obligation regarding fraud detection
  6. Include a mediation or binding arbitration clause to help resolve any dispute in the unfortunate event that a legal dispute does arise 
  7. Approval by the client with receiving signed copies by a board member.

Sample Audit acceptance letter :

Dear Recipient Name,

With reference to the audit request that you sent, we are glad to inform you that we decided to accept the assignment as per specified terms and conditions. Listed below is an outline of the project scope:

1) The audit will be conducted from {{start date}} till {{end date}}.

2) Area of audit: {{list of departments of entities included in the audit}}

3) Audit scope: {{the type of the audit: financial, fraud, etc. what will be audited}}

4) Audit Standard: {{the framework used in the audit process}}

5) Exclusions: {{what is not included in the audit}}

6) Deliverables: {{a brief description of outcomes and the reports that will be delivered}}

Going further from here, we propose the following action plan:

- Your finance department will provide;

- Our team will be given access to;

- Additional points.

Thank you again for your trust. Looking forward to doing business with you.

Yours sincerely,

Signature

Check out this Audit engagement letter template now for your reference when accepting an audit. Download this acceptance letter now.


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Reviews

Audie English - USA

I appreciate this content, it fits my purpose

Jan Smet

Very good audit acceptance letter