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Do you have to issue engagement letters?

Can terms of business be used for non-regulated work?

I have recently been told that you don't need to issue an engagement letter for non-regulated work. Instead, terms of business on your website is sufficient. The ICAEW website states engagement letters are preferred but not compulsory. Having spoken to someone at the ICAEW he said they are compulsory. Has anyone else done terms of business instead?

Terms of business will save so much time instead of issuing new updated engagement letters to all clients!

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03rd Jan 2019 14:04

Nope, not compulsory for ICAEW non-regulated work.

There are however some items you need to communicate:-
Provision of service regulations. (Must - Law).
Complaints procedure. (Must - ByeLaws).
Basis of fees. (Should - Ethics).

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03rd Jan 2019 14:21

The number of problems accountants have with clients when there is no letter of engagement to refer to . . .

Beware the website TOB. I was a witness in a case that went against us when we could not prove that the client was in receipt of TOB prior to engaging us.

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03rd Jan 2019 18:08

I’ve just had an ACCA review who failed us in the basis that I stupidly owned up to not have engagement letters for one specific group of clients (for whom our work is purely admin).

ie it’s compulsory for all engagements.

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to atleastisoundknowledgable...
08th Jan 2019 12:17

Yes, for ACCA, but not for ICAEW.

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08th Jan 2019 11:48

They do take a lot of time and effort and are nothing but a hassle. But then so is arranging insurance.

It is only if the ***t ever hits the fan that you will really wish that you had a signed E/L to fall back on.

You pay your money and take your chance!

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