From firm-operations
Contains verified engagement letter templates (AICPA SSTS No. 1, IRC 7216, limitation of liability clauses), client onboarding checklists, and billing/pricing model frameworks with collection escalation procedures. Engagement lifecycle, realization rate formulas, write-down analysis, client profitability metrics, scope change amendments, disengagement letters, welcome packages, year-end planning letters, missing information escalation cadence, and pre-engagement screening criteria. Consult when drafting or customizing an engagement letter, onboarding a new client, evaluating client acceptance or continuance, selecting a pricing model (hourly vs fixed-fee vs value-based vs subscription), setting up billing or invoicing, writing client communications (welcome package, tax organizer, deadline reminders, deliverable cover letters), handling scope changes or fee adjustments, calculating realization rates or client profitability, managing collection escalation for past-due invoices, or executing a formal client disengagement.
How this skill is triggered — by the user, by Claude, or both
Slash command
/firm-operations:engagement-managementThe summary Claude sees in its skill listing — used to decide when to auto-load this skill
Operational skill for the full client engagement lifecycle -- from pre-engagement
Operational skill for the full client engagement lifecycle -- from pre-engagement screening through active service delivery to disengagement. Synthesized from firm engagement letter standards, billing/pricing models, onboarding procedures, and client communication frameworks.
Every engagement starts with a signed letter. Separate letters per service line for the same client (tax and bookkeeping get distinct letters to delineate scope and liability). Reissue or reconfirm annually, even for recurring engagements.
Specify all forms in scope (1120, Schedule L, M-1/M-3, Form 5472 if foreign-owned, state returns). Address: estimated tax calculations (included or not), IRS/state notice response, e-filing authorization (Form 8879), automatic extension filing (Form 7004) if information not received by stated deadline, delinquent filing year range and advisory-only penalty estimates.
Define accounting basis, deliverable schedule (monthly/quarterly statements, reconciliations, AR/AP aging), accounting system subscription ownership (firm-paid vs. client-paid), transaction volume assumptions with overage fees, document delivery method and deadlines, monthly close and statement delivery cutoff dates. State explicitly: bookkeeping is not an audit, review, or compilation -- no assurance provided.
Before accepting any engagement:
Decline or price for risk if red flags present.
Entity details: legal name, EIN, entity type, state of formation, fiscal year-end, articles of incorporation
Financial history: prior 2+ years tax returns, existing books (cloud accounting software/desktop/spreadsheets/none), current year partials, open AR/AP aging
Banking: all bank accounts and credit cards (institution, type, last 4), loan statements with amortization, merchant processors (Stripe, Square, PayPal), POS systems
Payroll: provider, employee count (W-2) and contractor count (1099), pay frequency, states where employees work
Tax/compliance: sales tax permits and registered states, prior IRS/state notices, pending audits
For platform-specific setup steps, invoke qbo-integration:qbo-bookkeeping.
Send immediately upon signed engagement letter:
Default to hourly for year one to establish a baseline, then convert to fixed fee in year two with data-driven pricing.
Complexity drivers that increase price: multi-state filing, foreign ownership (Form 5472), delinquent multi-year filings, high asset/depreciation complexity, related-party transactions, aggressive audit-risk positions.
Risk adjustments: new client premium (setup + uncertainty), delinquent filer premium, uncooperative client premium, rush/expedited premium.
Tax (Form 1120): simple single-state = fixed fee; moderate multi-state with depreciation = fixed fee with complexity tier; complex foreign-owned or delinquent = hourly or premium fixed fee
Bookkeeping: monthly transaction-band pricing (0-100, 101-250, 251+); include reconciliation and statements; exclude payroll, 1099 prep, sales tax filing (price separately); if firm pays accounting system subscription, include with markup
Advisory: value-based for tax planning tied to projected savings; hourly for ad-hoc consulting; retainer for ongoing advisory; project-based fixed fee for entity restructuring
Bundling discount: 5-10% for clients combining tax + bookkeeping improves retention and smooths revenue.
Realization = fees collected / standard fees billed. Industry benchmark: 85-95%. Below 80% signals systemic pricing or collection problems. Track by engagement type, client, staff member, and service line.
Track write-down reasons: scope underestimate, staff inefficiency, client goodwill, competitive pressure. Persistent write-downs for a client = mispricing (raise fees or disengage). Persistent write-downs for a service line = systemic issue. Target: under 10% of total billings.
For fixed-fee engagements: fee collected / actual hours spent. Compare to firm target rate. Consistently below target = fee too low or process too slow. Track across years.
Revenue minus direct costs minus allocated overhead. Bottom 10-20% of clients typically destroy profitability. Unprofitable clients require: fee increase, scope reduction, process improvement, or disengagement. High revenue does not guarantee high profitability.
Clear service descriptions (not vague "professional services"), reference engagement letter and agreed fee structure, itemize out-of-scope charges separately with explanation, include payment terms and accepted methods.
Never hold a client's tax return for unpaid fees (AICPA ethical violation). Firm may retain its own workpapers but must provide client records upon request (AICPA ET 1.400.200).
Tax preparation milestones: documents received (in queue) -> in preparation (draft ETA) -> in review (quality review) -> ready for delivery (portal) -> filed (confirmation number)
Bookkeeping monthly: close completed -> financial summary (3-5 bullets: revenue, net income, cash, notable items) -> open items requiring client input
Send October-November for calendar-year corporations. Content: tax law changes affecting client, year-end strategies (acceleration/deferral), retirement plan contribution deadlines, estimated tax review, document gathering timeline, numbered action items for client decisions.
Include: summary of deliverables, key highlights (tax due/refund, effective rate, prior-year changes), client action items (sign/approve Form 8879, make estimated payments), estimated tax payment schedule with due dates, next steps. Deliver via secure portal with email notification -- never email returns as attachments. Offer 15-30 minute delivery meeting for complex returns.
Material scope changes during engagement require a written amendment or new engagement letter. The original letter should include a clause allowing fee adjustment for scope changes or unforeseen complexity. Out-of-scope work is billed at the hourly rate specified in the engagement letter. Document scope change requests and approvals in the practice management system.
Consistently unprofitable after fee adjustment attempts, uncooperative, or creates disproportionate risk. Requires partner approval.
Read these for full templates, checklists, and authoritative citations:
references/engagement-letters.md -- AICPA standards (SSTS No. 1, ET 1.310.001), required letter elements by engagement type, Form 1120 and bookkeeping letter specifics, limitation of liability guidance, client acceptance/continuance criteria, disengagement letter requirements, and decision points for fee structure and arbitration clausesreferences/billing-pricing.md -- detailed pricing model comparison with advantages/disadvantages, complexity drivers and risk-based pricing adjustments, financial metrics formulas (realization, write-downs, effective hourly rate, client profitability), billing cycle procedures, collection escalation, service-line pricing guidelines, and AICPA/IRS fee-related authoritative referencesreferences/client-communications.md -- complete communication templates for welcome package, C-corp tax organizer contents, year-end planning letter outline, missing information escalation cadence with sample language, deadline reminder schedules, deliverable transmittal cover letter format, engagement status update milestones, annual review meeting agenda, and disengagement letter required contentreferences/client-onboarding.md -- pre-engagement screening criteria, information gathering checklist by category, accounting system company setup sequence, chart of accounts setup procedure, opening balance entry approaches (OBE, historical JE, import/migration), bank connection and bank rule setup, user access roles, recurring transaction configuration, first-month deliverables, and decision points for existing books, desktop migration, catch-up, and multi-entity scenariosaccounting-foundation:entity-profile for corporate entity details needed during onboarding and engagement letter preparationqbo-integration:qbo-coa for chart of accounts setup during bookkeeping onboardingqbo-integration:qbo-bookkeeping for QBO-specific onboarding configurationbookkeeping:transaction-processing -- references engagement scope for service boundariesbookkeeping:catchup-bookkeeping -- references onboarding for catch-up pricing and scopetax-prep:form-1120-prep -- references engagement letter for return scopetax-prep:tax-compliance -- references deadline communication cadencefinancial-planning:strategic-advisory -- references advisory pricing modelsfirm-operations:practice-management -- receives engagement for workflow assignmentfirm-operations:quality-compliance -- references engagement review standardsnpx claudepluginhub aeyeops/aeo-basis-plugin-marketplace --plugin firm-operationsGenerates a complete client onboarding package: welcome email, intake questionnaire, kickoff agenda, access checklist, expectations doc, and 30/60/90-day check-in schedule.
Handles operational billing for legal matters: monthly bill prep, local counsel invoice review and disbursements, client query responses, cashflow modeling (LC payments vs receipts), leverage and burn analysis (staffing mix, predicted costs, margins).
Designs and optimizes CRM systems and client lifecycle workflows for advisory firms, covering segmentation, household management, service tiers, and retention analytics.