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Sample Audit Engagement Letter Template

Audit Engagement Letter

John Smith
ACME Audit Inc.
1234 Main Street
Arlington, TX 76010


Mr. Joe Jackson
5678 Sky Circle Dr.
Dallas, TX 75202

Re: Audit Engagement

Dear Mr. Jackson,

This letter confirms our understanding of the previously discussed arrangements for our audit of the financial statements of Jackson Enterprises, for the year ending 2011.

We will audit the Company's balance sheet as of 12/31/2011, along with the related statements of Income, retained earnings, and cash flows for all of 2011. Based on this audit we will provide our professional opinion. The financial statements are the responsibility of Jackson Enterprises management team. Our responsibility as your auditor is to express an opinion on the financial statements based on our audit.

We will conduct our audit process in accordance with generally accepted auditing standards. These standards require that we conduct the audit to obtain reasonable assurance if the financial statements are free of false and misleading statements. An audit of this nature will also assess the accounting principles that your company uses along with estimates that are made by management. Our audit will provide the basis for our opinion.

The procedures that we use will include tests of documentary evidence that supports the transactions recorded in your company's accounts along with direct confirmation of all receivables and liabilities through correspondence with randomly selected customers, creditors and banks.

This audit cannot be relied upon to detect all fraud or other irregularities. However, we will inform you of any material errors or illegal acts that come to our attention through the audit process. If you are planning on publishing or reproducing the financial statements and make reference to our firm and audit, you agree to give us the printer's proofs for our review and approval before printing commences.

As part of our audit engagement for the year ending 2011, a review will be conducted of your company's federal and state income tax returns for Jackson Enterprises.

We will be available throughout the year for answering questions regarding the tax effects of any proposed transactions or alterations to current business policies.

The fees we will be charging will be billed to you as work progresses and are based on the amount of time that is required to complete deliverables plus any out of pocket expenses. Invoices will be due immediately upon receipt. If there appears to be an error in our estimated total cost you will be notified immediately.

If this letter is a correct representation of your understanding, please sign the enclosed copy and return it to us promptly.

We appreciate the opportunity to conduct your audit and serve you and look forward to working with you for many more years.


John Smith

Client Signature





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