Accounting Services Agreement Template

When providing accounting services, creating a contract with your client falls on you. That contract specifies the terms of financial transactions that will take place between the two parties, as well as what you’ll provide as part of the contract.

An accounting services agreement is legally binding and specifies the terms under which two entities operate as part of an accounting relationship. Here, you’ll discover what an accounting services agreement should contain and why it pays to have a standardized template – customizable to each of your clients – on which to base that contract.

What Is an Accounting Services Agreement?

An accounting services agreement is a formal document that serves as a contract between an accountant and any entity with which they do business. Beyond outlining the terms and conditions of the relationship, the agreement outlines the scope of work the accountant will take on for the payment provided by the client.

The scope of that work can vary depending on the contract. Bookkeeping, tax preparation, reporting, consulting, and auditing can all fall under the document’s umbrella.

Beyond stating the services you’ll provide, you’ll also use this agreement to set payment terms and conditions. Clauses may also be entered into the contract to ensure confidentiality, and you must ensure the agreement contains clauses for dispute resolution should a dispute arise.

Think of it as a blueprint of an accountant's financial journey with their client. You tell the client what services you’ll provide – and under what terms they’re provided – with a document that details the responsibilities of both parties. Transparency is the goal – a good accounting services agreement leaves no room for doubt regarding each party’s expectations and interests.

As a new accountant, you may find it challenging to design an initial draft for this type of contract. To make life easier for yourself, download our free accounting services agreement template so you have a base document you can update and modify depending on your client’s needs.

Key Components of an Accounting Services Agreement

Given that an accounting services agreement is intended to be a comprehensive document, its structure is as important as the specific information it contains. After all, a contract that misses key elements could create the potential for disputes to arise further down the road. The following key components should all be present and as detailed as possible.

Essential Elements of the Agreement

Let’s start with the essential elements that define the relationship between your firm and its clients. Practically every accounting services agreement should contain the following details.

Services Rendered

Here you’ll get specific about the services you’ll provide to your client. Avoid terms such as “general accounting” – they’re too generic and could be used by a client to request almost any type of service from your firm. Instead, be as precise as possible in your descriptions. For instance, if you’re administering accounts payables and receivables, discuss what those services entail and what, if any, reporting you’ll provide. Remember – the more precise you are about your obligations to the client, the fewer opportunities you provide for accusations of negligence.

Payment Terms and Pricing

A typical accounting services agreement has a specified duration or term for the services you’ll render. Highlight this deadline, assuming one exists, as well as the pricing for each of the services rendered. You can also use this section to discuss payment terms – how you’ll be paid and when – to leave no doubt in your client’s mind.

A Confidentiality Agreement

Certified Public Accountants (CPAs) are obligated to keep client information confidential at all times. Ensure your agreement contains a clause that emphasizes this and, potentially, discusses the methods you’ll follow to protect the client’s most sensitive information.

This section of the agreement can become more complicated if your client tries to obtain confidentiality for a third party that isn’t directly subject to the initial agreement. In these cases, it’s best to create a similar contract with the third party, especially as CPAs don’t have an inherent responsibility for keeping third-party information secret.

A Section on Alterations

Your relationships with your clients may change over time. They may request new services or scale up to the point where your initial agreement isn’t viable. For these reasons, it's important to include the amendment provisions clause in your contract. This clause will allow both parties to make a mutually agreed-upon alteration to an existing agreement.

Ownership of Work

Though you’ll be working closely with your client – and will have access to many of their financial records – you don’t own anything that they provide to you. All of their records are essentially their intellectual property, with your agreement needing to contain clauses that emphasize their ownership of that information. This should include anything proprietary to the client but also any reports or records you provide based on their financial records.

For your part, you may also wish to insert clauses highlighting that any software – especially any built in-house – is your company’s property. This will prevent instances of clients requesting access to anything that isn’t their property.

Termination and Breach

All good things come to an end eventually, including the agreements you form with clients. Your contract must contain provisions for how either party acts if they want to terminate the accounting services agreement.

Furthermore, you need language that stipulates the consequences of a breach of the contract. Those consequences depend on the agreement – they could range from financial penalties to instant termination of the agreement. What’s crucial is that all entities involved in the contract understand what will happen if they break any of its terms.

Best Practices When Using an Accounting Contract

Once you have the crucial elements in place, you move on to drafting your accounting services agreement. The following are some best practices to follow to ensure that the agreement is watertight:

• Be Specific, Always – There’s almost no such thing as being too detailed in an accounting contract. The more detailed you are about your responsibilities and what you’ll provide, the more protection you create for yourself and your client. Ideally, the contract should answer all questions that a client might have.
• Get Lawyers Involved – This practice goes for all parties involved in the agreement. A good contract lawyer helps you to navigate the legalese in your agreement and could even draft the contract on your behalf.
• Collaborate With Your Client – An accounting services agreement sets the stage for you and your client to work together. Treat it as the collaborative document it’s intended to be. Hold consultations with your client and discuss the contract’s terminology while providing space for them to make their requests.
• Always Review Before Signing – Your accounting contract includes the signatures of involved parties, making it legally binding. Even if you’ve drafted the contract yourself, always review it thoroughly before adding your signature – you can’t go back once your mark is made.

Important Details to Include in Your Accounting Contract

While the above section detailed the essentials that an accounting services contract needs to contain from the service perspective, there are other details that should find their way into the document.

Contact information – both for you and your client – is one of those details. For your part, you should provide basic information, such as your address, phone number, and how a client can reach you. You may even include specific details for the accountant who’ll be working directly with the client, essentially providing names and faces to what might be a large accounting firm. Back those details up with information about each accountant’s licensing, especially regarding the states where they’re licensed to work, so your client can confirm their credentials.

A liability clause is also a good addition. You can use this clause to specify what damages – if any – you’ll pay to the client should you breach the contract. Any limitations on those damages, as well as language that prevents you from being liable for losses the client makes due to their own decisions, should also go into the document.

Finally, your firm may have warranties that it applies to its services, such as a money-back guarantee if the client isn’t happy after a certain period. Add those details along with any information about the circumstances in which the client can claim that warranty.

Benefits and Considerations

Now that you understand what goes into an accounting services agreement, the next question is obvious – why create one? After all, you may already have good relationships with the businesses you’re working with, making an accounting contract seem like extra (and unnecessary) legalese.

It isn’t.

As a service provider, you need to protect your company and its employees, which is where your contract comes into play.

Why Use an Accounting Services Agreement Template?

The idea behind your accounting services agreement is to get your new partnership off on the right foot with your client. Here’s why you need one for every client.

Achieving Legal Protection

Both parties benefit from the legal protection built into an accounting services agreement. The client has clear steps for recourse if a dispute arises, with the accountant gaining liability protection and more control over the relationship.

Clear Definition of Services

Without a comprehensive agreement, you risk the scope of the services you provide being stretched to their breaking point by your client. By clearly defining your services – including what they entail and how you’ll apply them – you minimize the risk of your client asking for more without paying. Given that long workweeks are common in accounting, this clarity of service provision can help to cut down on the hours you provide to your clients.

Fee Structure Clarity

Speaking of clarity, a lack of it regarding your fee structure could harm your firm. Your agreement sets out exactly what you’re getting paid for, how, and why, meaning clients can’t levy accusations of charging hidden fees against you. Clients also benefit – they get to see just how much your services cost upfront.

Enhanced Professionalism

Never underestimate the impact that a good first impression makes on a client. With an accounting services agreement, you show that your firm is professional and legally compliant because it produces official contract documentation. That bodes well – in your client’s eyes – for your future relationship.

Mistakes to Avoid

Given that accounting services agreements are contracts, they can be complex enough to create the possibility for mistakes. Avoid the following to make your agreements as strong as possible:

• Incorrect or Unclear Payment Terms – The less clear the payment terms in your contract, the more likely a dispute becomes. Clients may feel you’re overcharging them if they have to pay for something they believe is part of the agreement you haven’t specified. Plus, delivering the wrong fee structure can mean you don’t get paid what you’re owed because you have to stick to the wording in a legally binding contract.
• Failing to Create Exit Clauses – As wonderful as it would be for all of your relationships with clients to tick along with no troubles, that simply isn’t the reality of business. Your clients may become dissatisfied. Your firm may not want to work with the client. Either way, the lack of exit clauses means the “breakup” can get messy.
• Filling the Agreement with Legal Language – Some legal language is inevitable in your agreement. It’s a legal document, after all. But filling it with so much legalese that your client can’t understand it means they don’t have a clear grasp on your service. In the worst cases, this could lead to a client abandoning you right at the point where they were going to start using your services.
• A Lack of Consequences – If a breach in the agreement occurs – such as late payment – you’ll have a fight on your hands to claim what the client owes you if no clauses define what happens in a breach.

And, of course, there’s the biggest mistake of all – not having an accounting services agreement in the first place. Ensure that doesn’t happen by downloading our free Accounting Services Agreement template today.

Accounting Services Agreement Samples and Templates

Why draft an accounting services agreement yourself when you can use a template to handle most of the fine details? With Bonsai, you get access to over 1,000 templates – usable in almost all aspects of your business – so you’re never stuck trying to figure out what clauses go where.

Overview of Available Templates

Below is an example of our accounting services agreement template. Note that when you download the template, you can customize it to your needs with everything from your payment details to the scope of the work you’ll provide to the client.

<INSERT SAMPLE TEMPLATE HERE>

However, this template is far from the only one that Bonsai produces. Our available templates cover all of the following categories:

• Contracts
• Quotes
• Invoices
• Proposals
• Forms
• Agreements
• Briefs
• Scopes of Work

How to Utilize Accounting Agreement Templates

Though our accounting agreement template is fairly standardized, the key to utilizing it properly lies in the details you add. Naturally, you need to confirm that everything related to your firm is present and correct. Payment terms and structures have to match what you’re telling the client, as do late fees and similar consequences. Your template includes sections to insert all of this information, so ensure it’s added and double-checked before your contract heads over to the client.

Secondly, don’t assume that the template covers every single aspect you may want it to cover. It will contain clauses for all of the essentials – as discussed earlier – but you may have specific clauses you wish to insert. A comprehensive review before sending and signing is essential. Consider going over your templated draft with a legal professional before you move forward with your agreement.

Finally, don’t be afraid to work with your client when customizing your template. The agreement isn’t legally binding until all relevant parties sign, so collaborating in the early stages to tweak the details can lead to a much stronger relationship.

All that’s left is to get your hands on the template. Enter your email address below to customize your free accounting services agreement document.

Frequently Asked Questions

How Do I Know if I Need an Accounting Contract?

The answer is simple – any time you provide accounting services, you need a contract to detail the nature of those services and how you’ll be paid for them. On the client’s side, they’ll know they need a contract if they engage a firm for any accounting services, ranging from an audit or general advice to more in-depth bookkeeping services.

What Services Are Typically Included in an Accounting Contract?

It depends entirely on the scope of your engagement with your client. Examples of services that could be included, but aren’t guaranteed, are bookkeeping, payroll management, tax preparation, and reporting on profits and expenses. But the reality is that an accounting contract should be customizable to the client, though structured to provide the same protection to you and that client each time.

How Do I Choose an Accountant for My Accounting Contract?

Focus on looking for specialists first, especially if you have unique accounting requirements. The more dedicated the accountant is to a specific job – such as bookkeeping – the more likely they are to produce strong results. Verifying the firm’s licenses is also important. For instance, you can use The American Institute of Certified Public Accountants website to verify any license details you receive.