Part 6 - Professional risk: Engagement letters and TOB
- The Just Audit team
- 19 hours ago
- 1 min read
Our risk partners Karen Eckstein Ltd summarise the ICAEW call to review professional engagement letters and terms of business
ICAEW has recently updated its engagement letter templates, reinforcing the message that firms should be actively reviewing and refreshing their engagement letters and terms of business.
“Firms should ensure that ICAEW’s engagement letter templates are carefully tailored to reflect their specific service structure, internal processes and the precise scope of work agreed with each client. A generic, unmodified engagement letter may fail to capture the nuances of the services being provided, leaving both the firm and the client without adequate clarity or protection” (ICAEW.com)
The updated templates introduce a number of new schedules (including ID verification, Companies House filings, MTD and agreed upon procedures) and, importantly, echo the PCRT (Professional Conduct in Relation to Taxation) position by emphasising the need for transparency around the use of AI in service delivery.
Although separate from PCRT, this highlights a growing focus among regulators on ensuring that engagement documents are kept up to date and address emerging issues. We expect this to be echoed across other regulators of professional services firms.
If your engagement letters and supporting documents haven’t been revisited recently, this may be a good prompt to do so.
You can access ICAEW’s updated engagement letter guidance and templates here.
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