CPA Engagement Agreement & Service Terms
Our CPA engagement agreement establishes the standard terms and conditions for professional accounting and tax services provided by HRX CPAs to ensure clear expectations and quality service delivery.
Sample Professional Service Agreement
Below is an example of the standard professional service agreement, which outlines the terms of the working relationship between HRX CPAs and our clients.
Service Scope
Clearly defined deliverables
Responsibilities
Both client and firm duties
Fee Structure
Transparent pricing terms
Protection
Liability and confidentiality
Scope of Services
Services to be Provided
This engagement letter specifically outlines the services HRX CPAs will provide. Services not listed require a separate agreement.
Tax Services
- • Federal and state income tax preparation
- • Quarterly estimated tax planning
- • Multi-state tax compliance
- • Tax planning and strategy consultation
- • IRS correspondence and representation
- • Business entity tax returns
Accounting Services
- • Monthly financial statement preparation
- • Bookkeeping and transaction recording
- • Payroll processing and compliance
- • Sales tax preparation and filing
- • Year-end closing procedures
- • Financial analysis and reporting
Advisory Services
Business Advisory
- • CFO consulting
- • Business planning
- • Cash flow management
- • Entity structure advice
Valuation Services
- • Business valuations
- • Estate planning valuations
- • Gift and estate tax valuations
- • Litigation support
Exit Planning
- • Business exit strategies
- • Succession planning
- • Transaction structuring
- • Post-sale tax planning
Client Responsibilities
Critical for Service Quality
Client cooperation and timely information provision are essential for accurate, high-quality service delivery.
Information & Documentation
- • Provide complete and accurate financial records
- • Submit documents by agreed deadlines
- • Notify of changes in financial circumstances
- • Maintain organized books and records
- • Respond promptly to information requests
- • Review drafts and provide feedback
Communication & Decisions
- • Maintain regular communication schedule
- • Make timely decisions on recommendations
- • Inform of business or personal changes
- • Attend scheduled meetings and calls
- • Provide authorization for filings
- • Review and approve final deliverables
Document Retention Policy
Clients are responsible for maintaining supporting documentation for all tax positions for at least seven (7) years after filing. We recommend keeping business records permanently for operational and historical purposes.
Fees and Payment Terms
Fee Structure
Monthly Packages
Fixed monthly fees for ongoing services, paid in advance
Project-Based
Fixed fees for specific deliverables like tax returns or valuations
Hourly Consulting
$200-$400/hour for specialized advisory services
Payment Terms
- • Monthly packages: Due by 1st of each month
- • Project fees: 50% at start, 50% upon completion
- • Tax returns: Due before e-filing
- • Late fees: 1.5% per month after 30 days
- • Payment methods: ACH, wire, check
- • Annual packages: 5% discount if paid in advance
Service Suspension Policy
Services may be suspended for accounts more than 30 days past due. Work will not resume until payment is current. Client remains responsible for deadlines during suspension periods.
Professional Standards & Limitations
Professional Standards
- • AICPA Code of Professional Conduct
- • California Board of Accountancy regulations
- • IRS Circular 230 requirements
- • Continuing education requirements
- • Professional liability insurance
Liability Limitations
- • Limited to fees paid for specific service
- • No consequential or punitive damages
- • Claims must be made within 2 years
- • Subject to professional liability coverage
- • California law governs agreement
Important Disclaimers
- • No guarantee of specific tax savings or outcomes
- • Tax positions subject to IRS examination and interpretation
- • Client remains responsible for business and financial decisions
- • We do not provide legal, investment, or insurance advice
- • Audit representation limited to matters we prepared
Confidentiality and Record Management
Confidentiality
- • Strict confidentiality of all client information
- • Limited exceptions for legal compliance
- • Client authorization required for disclosure
- • Professional ethics protections
- • Secure data handling procedures
Record Retention
- • Client files retained for 7 years minimum
- • Electronic storage with backup systems
- • Access provided upon request
- • Secure destruction after retention period
- • Compliance with professional standards
Data Security Measures
We implement comprehensive security measures to protect client information:
- • 256-bit SSL encryption for all data transmission
- • Multi-factor authentication for system access
- • Regular security audits and updates
- • Employee training on data protection
- • Cyber liability insurance coverage
Engagement Termination
Client Termination
- • 30-day written notice for ongoing services
- • Immediate for project-based work upon completion
- • Payment due for all completed work
- • Client files provided within 30 days
- • Transition assistance as requested
Firm Termination
- • Non-payment of fees
- • Failure to provide required information
- • Professional ethics conflicts
- • Scope changes beyond agreement
- • 30-day notice when professionally permissible