We all use engagement letters from time to time as a formal way to document work that we have agreed to do for our clients. They are a useful tool to reduce misunderstandings, and make sure that we are clear with our clients on the work that needs to get done. Do they always work? Do you always write one?

Engagement Letters with a Twist
Over the years, I have put a major twist on the engagement letters that I use. The main difference is that although I write the letter, it isn't a letter from me to my client (you can do one of those too if you wish), it is a letter from my client to their staff, and managers.

I use these type of engagement letters at the beginning of almost every engagement that I do, and often they get e-mailed to every employee in the company. I love engagement letters in situations like this because they have several key benefits:

• You have your contact send out the engagement letter, so they will make sure that the two of you are crystal clear on the work that you will be doing. You write the letter, your contact edits it as necessary and sends it out. This virtually eliminates any misunderstanding about the scope of the work. Most accountants simply have a letter of engagement between themselves and their contact. This is good, but the contact is less likely to give the letter their full scrutiny, until something goes wrong.
• The letter introduces you to the people you will be working with, even if you already know them all in your current capacity. It also tells any potential participants what to expect, regarding deliverables and timelines. This greatly increases your chances of a successful engagement.
• Coming from their boss, the engagement letter gives you instant credibility for the work you will be doing, and it positions the work as very important to the organization. You will even find booking meetings with the recipients is easier after the letter has gone out!
• Finally, it firmly and publicly confirms that you have the job. Sometimes in the sales process, it can be a little fuzzy whether you have been given the go-ahead to start an engagement. Once this letter goes out, there is absolutely no doubt.

Many of the business planning engagements that I do, can be a little more complex, and may require the involvement of many people in a client organization. I have found this type of engagment letter to be an invaluable tool. I hope you can find a use for them in your practice.

The Business Planning Boot Camp contains samples, diagrams and templates for every concept. If you would like me to e-mail you some free sample engagement letters in MS Word format, simply reply to this e-mail, and change the subject line to "Sample Letters".

If you do any small business consulting, or if you would like to take your practice to the next level, visit The Planning Boot Camp website for Bookkeeper's Simply click on the link to the left, or paste this into your browser: www.planningbootcamp.com/Bookkeepers