What it is
Consulting work is where scope creep and misunderstood roles cause the most trouble for CPA firms. The AICPA Statement on Standards for Consulting Services, CS section 100, expects an understanding with the client on the nature, scope and limitations of the work, and recording that understanding in a signed letter is the practical way to meet it.
This template states the objective and deliverables, says that the service gives no assurance, puts management decisions on the client, covers the independence question when the client is also an attest client, and sets rules on fees, use of the deliverables, confidentiality and ending the engagement.
When to use it
- Advisory work such as process improvement, budgeting and forecasting models, systems selection, transaction support or entity structure advice.
- A client asks for a recommendation and you want the limits of your role set out first.
- You perform consulting for an attest client and need the management responsibilities documented for the independence file.
What’s inside
- Objective, activities and deliverables with a statement that anything else is out of scope
- Nature of the service: consulting, no attest, no assurance, advice as of a date
- Client responsibilities: decisions, a designated overseer, information and implementation
- Optional independence paragraph for attest clients
- Fees, use and ownership of deliverables, confidentiality, term and termination, signatures
Standard cited
This template follows AICPA CS section 100. It is written in our own words, except for phrases the standard requires the document to contain, with [bracketed placeholders] for client details, amounts in USD and dates as MM/DD/YYYY. Check it against the current standard and your firm’s methodology before use.
Questions
Does CS 100 require a written understanding?
The standard requires an understanding with the client about the engagement, and the understanding may be oral or written. A signed letter is far easier to rely on if the scope is disputed, which is why the template is a letter.
What are the general standards that apply to consulting?
CS section 100 sets four general standards that apply alongside the Code: professional competence, due professional care, planning and supervision, and sufficient relevant data. It adds standards for the client relationship: an understanding with the client, communication with the client including significant reservations, and the practitioner’s duty to inform the client of conflicts of interest.
Can we do this for an audit client?
Often yes, but it is a nonattest service and the AICPA independence rules apply. Management must take responsibility for decisions, designate a person with suitable skill, knowledge and experience to oversee the service, and evaluate the results. The template has a paragraph where you note your evaluation. The firm’s independence file should hold the facts and the conclusion.
Should the letter include a limitation of liability?
Only after legal advice. Such clauses are governed by state law and professional rules and can be unenforceable or prohibited in some settings. The template leaves a bracketed placeholder instead of wording.
Related templates
- CPA Fee Proposal Letter
- Nonattest Services Independence Evaluation Form
- Engagement Scope Change Letter (Addendum)
- Client Acceptance and Continuance Form
Last updated 11/05/2026. All free templates.