Illustrative Audit Engagement Letter Template (Page 4 of 5) in pdf

that could have a direct and material effect on each of the major programs. The purpose of these

procedures will be to express an opinion on compliance with requirements applicable to each of its major

programs in our report on compliance issued pursuant to OMB Circular A-133.

Audit Administration, Fees, and Other Immediately upon completion of the engagement, the auditor

shall send a copy of the reporting package to (Auditee’s Name). The reporting package will consist of:

1. An opinion (or disclaimer of opinion) as to whether the financial statements are presented fairly in all

material respects in conformity with accounting principles generally accepted in the United States

and, when applicable, an opinion (or disclaimer of opinion) as to whether the schedule of

expenditures of federal awards is presented fairly in all material respects in relation to the financial

statements taken as a whole.

2. A report on internal control and compliance with laws and regulations material to the financial

statements and, when applicable, major federal programs. This report shall describe the scope of

testing of internal control and compliance, the results of the tests, and, where applicable, refer to the

separate schedule of findings and questioned costs.

3. A report on internal control and compliance with laws, regulations, and the provisions of contracts or

grant agreements, noncompliance with which could have a material effect on major federal

programs.

4. A summary schedule of findings and questioned costs.

5. A summary schedule of the current status of any prior findings.

6. Management’s corrective action plans, which you will prepare.

7. A management letter to convey suggestions and recommendations not suitable for the foregoing

reports.

Our audit will include a review of any prior-year suggestions and recommendations and will indicate the

extent to which the summary schedule of prior year audit findings is fairly stated. As to any current-year

recommendations and suggestions, we will afford you the opportunity to respond to such matters and

will include your response(s) in management’s corrective action plan.

Subsequent to the issuance of the report, should it be necessary to alter or reissue the report and/or any

management letter, CPA Firm’s Name shall distribute such reissued report and/or management letter in

the same manner as the original report and management letter.

We expect to begin our audit on approximately (Date) and to issue our reports no later than (date).

(Name of Engagement Partner) is the engagement partner and is responsible for supervising the

engagement and signing the report.

Our fees for all services are related to our standard hourly rates in effect at the time services are

performed. Our standard hourly rates vary according to the degree of responsibility involved and the

experience level of the personnel assigned to your engagement. Our fee for this engagement will be

$____ from which XXX% will be paid upon YYY and XX% upon ZZZ.

If a multi-year engagement is entered into, all outstanding invoices for work performed during any prior

engagement will be paid in full before work commences on the current engagement.

During the course of our audit, it is possible that we may observe opportunities for economies of

operation and for improved internal administrative and accounting controls, or we may observe

Illustrative Audit Engagement Letter Template Page 4