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Accounting Review Engagement Letter Template for England and Wales

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Key Requirements PROMPT example:

Accounting Review Engagement Letter

"Need an Accounting Review Engagement Letter for our manufacturing company with annual revenue of £5M, requiring quarterly reviews starting March 2025, with specific focus on inventory valuation and cost accounting procedures."

Document background
The Accounting Review Engagement Letter serves as a crucial document establishing the professional relationship between accounting firms and their clients for review services. Used when a full audit is not required but assurance is needed, this document outlines the nature, scope, and limitations of the review engagement. Under English and Welsh law, it ensures compliance with regulatory requirements while protecting both parties' interests. The letter typically includes details about methodology, timelines, fees, and responsibilities, adhering to standards set by professional bodies like the ICAEW and FRC.
Suggested Sections

1. Introduction and Addressee: Opening section identifying the client and firm details

2. Scope of Review: Detailed description of the review engagement services to be provided and their limitations

3. Respective Responsibilities: Clear delineation of management's responsibilities and the practitioner's responsibilities

4. Professional Standards: Reference to ISRE 2400 and other applicable professional standards

5. Fee Arrangements: Details of fees, billing arrangements, and payment terms

6. Timing: Expected timeline for the review engagement

7. Staff Arrangements: Details of key team members and their roles

8. Agreement of Terms: Formal acceptance and signature section

Optional Sections

1. Specialist Services: Additional services beyond standard review engagement scope

2. Group Reporting Requirements: Special considerations and requirements for group companies

3. Regulatory Matters: Specific regulatory requirements affecting the engagement

4. Use of Technology: Details of specific software or technology requirements for the engagement

Suggested Schedules

1. Standard Terms of Business: Firm's standard terms and conditions including liability limitations

2. Fee Schedule: Detailed breakdown of fees, rates, and charging structure

3. Data Protection Statement: Privacy policy and data handling procedures

4. Engagement Team Structure: Detailed organization chart and contact information for key team members

Authors

Alex Denne

Head of Growth (Open Source Law) @ ¶¶Òõ¶ÌÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions






























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Industries

Companies Act 2006: Primary legislation governing company operations in the UK, particularly relevant for sections relating to accounting records and reporting requirements

Financial Services and Markets Act 2000: Key legislation regulating financial services in the UK, setting out regulatory framework for financial activities

Money Laundering Regulations 2017: Regulations requiring accountants to implement anti-money laundering controls and conduct appropriate client due diligence

Data Protection Act 2018 and UK GDPR: Legislation governing the handling and protection of personal data in the UK post-Brexit

ISRE 2400 (Revised): International Standard on Review Engagements providing framework for conducting review engagements

FRC Ethical Standard: Financial Reporting Council's standards setting out fundamental principles of ethical behavior for accountants

ICAEW Code of Ethics: Professional code of conduct issued by the Institute of Chartered Accountants in England and Wales

ISQC 1: International Standard on Quality Control establishing quality control standards for firms performing audits and reviews

FRC Requirements: Regulatory requirements set by the Financial Reporting Council for accounting professionals

Supply of Goods and Services Act 1982: Legislation governing contracts for the supply of services, including professional services

Unfair Contract Terms Act 1977: Law regulating unfair terms in contracts, particularly relevant for limitation of liability clauses

Consumer Rights Act 2015: Legislation protecting consumer rights, applicable if the client is a consumer rather than a business

Hedley Byrne Principles: Common law principles establishing duty of care in professional services and basis for liability limitation

Professional Indemnity Insurance Requirements: Regulatory requirements for maintaining professional indemnity insurance coverage for accounting services

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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