How to Write a Letter to Switch Accountants

Certified public accountants (CPA) are required by many individuals and businesses to file taxes and an analyze financials. However, not all CPAs are trustworthy or efficient, and if they are not delivering these essential services accurately it may be time for the business or individual to send a letter to change accountants.

If the accountant has a legal contract for employment, changing accountants must be done according to the terms mentioned in the contract. If these are not followed, the accountant or accounting firm may be able to take legal action because a breach of contract.

Before firing an accountant, the individual should have another accountant or accounting firm ready to immediately step into the position. This is to ensure that the financial records stay intact during the termination process. 

The main reasons for firing an accountant are:

• Many business owners and individuals don’t understand financial statements. Understanding financial statements and tax codes is a skill that takes time to learn. This is why they employ an accountant. 

Unfortunately, some accountant would like their employer to stay in the dark about their financials, thinking this gives the accountant job security. A worthy accountant will be able to explain financial statements and other financial issues in a language the business owner or individual understands.

• An accountant should understand tax law, and be able to help the individual or business owner take advantage of all legal deductions. Tax laws are constantly changing and the accountant should keep up with the latest. 

It is essential that the tax return is accurate or there could be serious repercussions with the Internal Revenue Service (IRS). If there are any discrepancies, the IRS will go after the individual or business owner and not after the accountant.

• The worst-case scenario is an account who is dishonest. He or she can charge unfair fees and even cheat the individual or business out of money. The best way to determine if the accountant is honest is for the individual to ask the accountant to teach the basics of accounting. 

They should be able to teach simple methods that will save their client’s money. If they refuse to do this for whatever reason, they may not be honest.

• The accountant should not give vague or outdated advice. An efficient accountant for a business should be able to give detailed advice for:

o Leasing or buying equipment
o Saving money in retirement accounts
o Reducing the tax burden
o Selecting good accounting software

Clients should be careful when they fire their accountant. They should have specific reasons for firing with proof. They should also consider the ongoing work and may not want to send a letter to change accountants during an in-process tax return or other serious financial issue. 

Letter should be polite and formal

The letter should be polite and formal. It is not the place to show anger. If the accountant feels insulted as well as fired, he or she may slow the transition process to a new accountant. 

Doing this is an ethical violation and may be against the law if the accountant destroys a client’s files or intentionally makes the transition process to a new accountant more difficult.

If it is suspected that the accountant committed an ethics violation the state CPA association or accounting association should be informed. Accountants may not be regulated in all states but CPAs are.

Here is a sample of a letter to change accountants. It should state the intent to terminate the accountant’s services effective immediately upon receipt of the letter. It should be sent by certified mail, to ensure a record of receipt. 

It can also order the accountant to stop any work in progress. It is not necessary to give a reason for the change. If another accountant or firm has been employed, the accountant can be requested to send all files to them.

Sample letter to change accountants

Name of Client
Name of Business if Applicable
Address of Client or Business
City, State, Zip Code

DATE

Accountant’s Name
Accountant’s Address
City, State, Zip Code

RE: Changing of Accountancy Services

Dear Accountant’s Name:

It has become necessary for my business to employ a larger accountancy firm. Since we have grown to include online sales, it has become apparent that we need e-commerce financial advice.

I have been very satisfied with the service I received from you, and this termination of services is in no way an expression of dissatisfaction. I have engaged Name of Company to take over the financial accounts of my business and would appreciate it if you give all the information they require when they write to you within the next two weeks.

If you submit your final invoice at the end of this month as usual, I will pay it immediately. Thank you for all the assistance you provided while my business was just starting out. I wish you well in the future.

Sincerely,

Signature of Client
Printed Name of Client