Recording your company’s financial transactions into organized accounts day to day is quite stressful. If you are looking to hire someone to handle the bookkeeping for yourself or your company, it’s important that you consider using a sample or template for contract bookkeeping.
A bookkeeping contract is a legally binding agreement between an individual or company and the person providing bookkeeping services. A bookkeeping contract goes by many names. You might hear it referred to as a bookkeeping services contract, an accounting contract, a bookkeeping contract agreement, or just a bookkeeping agreement. However you referred to it, it serves as an agreement between a client or company and a bookkeeper who provides accounting services. It clearly outlines responsibilities for all parties involved and protects everyone’s legal rights.
In a bookkeeping services agreement, you can explain exactly what services you want a bookkeeper or accountant to provide. If you are a bookkeeper taking on a new client, it is essential that you set up this contract to make sure that you get paid for the services you provide and that the client company knows exactly what services to expect of you.
You can use a bookkeeping contract template free of charge, or you can draft one yourself so that it has all the specific sections and subsections you want. A bookkeeping services agreement gives you a legal understanding of what services you are supposed to provide as the bookkeeper or accountant, and it also provides the client with an understanding of what their legal obligations are in terms of services and payments.
Deciding whether or not to use a free bookkeeping accounting services agreement template can be difficult. In fact, there are many situations where smaller contractors, like independent contractors providing accounting services, worry about asking a client to sign a contract for fear that it will damage their continuing business relationship. However, crafting a professional document or using a free bookkeeping services agreement template can save you from a lot more trouble down the line, and it’s worth the risk of requesting a signed contract upfront.
For example:
Janet is a bookkeeper. She is looking for a new client. One client comes highly recommended by a close friend. This client and the close friend went to school together. Janet speaks with the new client about the services she provides. They explained that they want someone to keep track of general bookkeeping and make sure all of the employees get paid on time, twice per month. At this time, the company only has three employees, and Janet is paid a fixed rate… Janet doesn’t see the harm in taking on this new client without an official agreement. So they begin their working relationship. For the first month, everything went well. However, during the second month, the client started asking if she could also do some budget preparation. It was minor preparation, so Janet agreed. Then the company added six more employees for whom Janet had to render payment twice per month. The company did not ask if this constituted a contractual change to their agreement even though it represented a 200% increase in the amount of work that Janet had to do. Because Janet didn’t have an agreement, she had to negotiate her compensation all over again, given the new extended service she was providing.
To avoid a situation like Janet’s, you should use this type of bookkeeping agreement anytime you hire a bookkeeper or accountant to do services for your company or yourself… If you provide bookkeeping services, you should always have an agreement with any company, no matter how small the contract might seem.
With a free bookkeeping contract template, you can make sure you have all of the right sections included in the agreement:
This bookkeeping contract is entered into by and between [Company] (the Accountant) and [Client] (the Client) as of [Contract.CreatedDate].
WHEREAS the Client wishes to retain the Accountant for bookkeeping services,
AND WHEREAS the Client agrees to engage and compensate the Accountant as an independent contractor for these services, and the Accountant agrees to provide such services,
THEREFORE, in consideration of the terms and conditions detailed in this bookkeeping contract, the receipt, understanding, and approval of which is duly acknowledged through electronic signature from both parties below, all parties to this contract agree to the following:
The Accountant shall provide the following services to the Client:
Hereafter referred to as “services”.
The Client agrees to pay the Accountant $400 per month, paid electronically on the 1st of each month.
This bookkeeping contract is considered effective as of the created date and shall proceed on a month-to-month basis until canceled by either party.
The Client agrees to engage the Accountant as an independent contractor.
The Accountant shall not share such information with any party without express written consent from the Client unless otherwise required to do so by law.
When you are ready to write your bookkeeping contract, you can use a sample bookkeeping contract as an example. You can add any unique sections you might need to fit your specific situation. However, in most cases, you can use the same main sections.
Start by identifying the name of the accountant and the client or any other parties involved in the agreement. You must include full names, mailing addresses, and the official date of the agreement.
Next, you will identify the services being rendered. This can extend to things like payroll, general bookkeeping, bill payments, bank reconciliation, financial transactions, customized reports, budget preparation, and more. You can list all of the services the bookkeeper will provide, and at the end of that list, you can write “hereinafter referred to as “accounting services.” Anyone reading the contract will know when they see “accounting services,” the contract is referring to the specific services you listed earlier.
Once you have explained the services, you need to specify the fees. This section includes what the client agrees to pay for the bookkeeping services and whether the bookkeeper is a company employee or an independent contractor. This compensation can be a fixed rate for the sum total of the services provided or an hourly rate… In this section, you should also include how often the specified services are to be compensated. The payment frequency can be as often as the parties agree, weekly, biweekly, monthly, quarterly, yearly, or upon completion of particular services.
You can also include terms addressing who will pay for work-related, out-of-pocket expenses required for things like accounting software. This can include travel expenses, postage, tax fees, or fees for experts and attorney’s fees.
Specify the term or length of the contract. Make sure you include language so the parties understand the effective date for bookkeeping services and whether the agreement is ongoing or fixed. Also included in this area are the rules for termination, such as whether termination by the bookkeeper or by the client requires advance written notice, usually 30-60 days..
Depending on where you are hiring, you should specify the employment status. This is particularly important if you are hiring someone as an independent contractor because that changes the company’s obligations to pay additional taxes and provide insurance.
Don’t forget to include a section about confidentiality, especially when there are things like data access provided to the bookkeeper. You should specify within the confidentiality agreement what types of punitive damages might be sought in the event of a breach of confidentiality.
You can download a PDF sample to draft a bookkeeping service agreement with confidence:
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