Bookkeeping helps develop and maintain a business’s financial processes and management. It sets up a system of checks and balances, which helps maintain accountability. Thus, the role of a bookkeeper is crucial in maintaining the financial health of an organization.
Several businesses, from large enterprises to freelancers, turn to bookkeepers to manage their finances. Seasoned bookkeepers know that bookkeeping is much more than just reporting on figures. It includes analysis of the data resulting from the findings, summarizing recorded transactions, and reporting on the same. A bookkeeping service agreement ensures that as a bookkeeper, you are duly compensated for all the bookkeeping activities, financial advice, and protected from any liabilities for the services that you render. For businesses, the bookkeeping service agreement can clearly outline the services that they wish to avail, whether it is record-keeping, maintenance, or budgeting.
As a result, it is important to draft a bookkeeping service agreement to keep things professional and secure your interests right from day one.
Every bookkeeping service agreement must contain the following sections:
The main introduction of the bookkeeping service agreement records the names of the parties involved. It also provides a summary of all the basic points of the agreement, such as the services involved, compensation of the bookkeeping accountant, and terms and conditions. It may also outline the period of engagement and the prospective date when the bookkeeping service agreement will be deemed null and void.
As stated previously, bookkeeping companies can offer a wide array of services. Thus, this clause of the bookkeeping service agreement interprets and outlines the services that the client wishes to procure. Having a clear definition of the services ensures that your services are not exploited by increasing the scope of your work.
In addition to defining the services, this section of the bookkeeping service agreement also contains details pertaining to the rates corresponding to the services. It legitimizes your claim that the client has agreed to pay a certain sum at a particular rate for all the services that you render. You can charge flat service fees, hourly rates, or a monthly retainer depending on your business model and the nature of the project.
For a fair assessment of the company’s financial health, you need to access all the recorded data available. The client must agree to grant you access to all the financial records and accounts. And at the same time, the client must also assume full responsibility for ensuring the accuracy of these records. This clause ensures that you have all the material to work with and are not held accountable in case this data is tainted.
You may be using intellectual property in the form of tools and templates that have been developed through years of service. Just because a client is making use of your services, it does not mean that they own your intellectual property. Hence, you must include a clause regarding the protection of your IP in the bookkeeping service agreement.
This clause of the bookkeeping service agreement ensures that the client does not pursue you for the things that you are not responsible for. It sets out the boundaries of your responsibilities and limits the amount for damages and liabilities that a client can seek in exchange for your services.
As you can see, a bookkeeping service agreement is a must for all bookkeeping service transactions. Bookkeeping is a time and labor-intensive task, so it is only fair to ensure that you and your interests stay protected.