How to Write a Clear Request for Proposal for an External Audit

Commercial disclosure: This business education article includes a promotional link to FAR Consulting Middle East. It is not an independent endorsement.

Inviting several audit firms in Dubai to quote can produce proposals that appear comparable while describing very different engagements. One includes group reporting support, another covers a single legal entity, and a third assumes the accounting records are already reconciled. A clear request for proposal, or RFP, gives firms the same facts and asks them to explain the same deliverables.

The purpose is not to force identical audit methods or obtain a guaranteed opinion. It is to define the business need, disclose relevant complexity and make the appointment decision traceable. Owners can then compare suitability and responsibilities alongside the fee.

Describe the entities and intended reporting

List the legal entities included in the proposed engagement. Identify the reporting periods, licensing jurisdictions and the parties expected to use the report. Explain whether a parent company, lender or relevant authority has specified a particular reporting requirement. Attach those instructions where they are available.

Do not state that an approval or reporting requirement applies merely because another business uses it. Ask each firm to explain any eligibility checks it needs to complete. The selected firm should confirm its suitability for the specific engagement before appointment, with relevant evidence where an authority requires it.

Give a realistic picture of the finance records

Provide a concise description of operations, transaction volume, accounting software, locations and the internal finance team. Explain material changes such as a new system, acquisition, restructuring or first audit. If the records contain unreconciled balances or a backlog, disclose that condition rather than letting firms price on a false assumption.

For a hypothetical trading group, useful context might include warehouse locations, overseas suppliers, several currencies and transactions between group entities. These facts help firms ask relevant questions. They do not establish how much work will be necessary or which opinion will ultimately be appropriate.

Separate the required service from optional support

State the core requirement clearly. For example, the request may concern an external audit of specified financial statements. Keep bookkeeping clean-up, internal audit, tax return preparation and separate reports in an optional-services section. Ask firms to price and explain them separately.

This separation also creates space for an independence discussion. If a firm is already providing other services, ask it to identify potential conflicts and explain how relevant independence requirements will be addressed. Avoid requesting an arrangement that assumes the same provider can undertake every role without assessment.

Ask for a named delivery approach

Request the proposed engagement partner, main contact and expected team structure. Ask how the firm allocates work, reviews significant matters and escalates unresolved questions. A proposal should explain how management will know what remains outstanding and which items require a decision.

Describe preferred communication arrangements, including progress updates and the document request process. Invite the firm to suggest adjustments where the proposed timetable or access arrangements are unrealistic. Good procurement makes those dependencies explicit instead of treating a target date as an unconditional promise.

Define the timetable and management responsibilities

Set out the intended planning, fieldwork, review and reporting milestones. Identify when management expects to provide the trial balance, draft financial statements and supporting schedules. Ask firms to state which assumptions underpin their timetable and what happens if records arrive late.

Include practical access questions: who coordinates responses, whether site visits may be needed and which overseas teams must participate. Management should expect to remain responsible for its records and financial statements. The engagement letter should explain the final allocation of responsibilities.

Request a transparent fee structure

Ask for the core fee, any applicable additional charges, payment milestones and the circumstances that could trigger a scope change. Require a clear explanation of exclusions. A lower headline price may exclude travel, additional entities or work required because records are incomplete.

Avoid turning this into a demand for the lowest fee regardless of circumstances. Assess whether the firm has understood the engagement and provided credible assumptions. Keep a written record of clarification questions and circulate material changes to all participating firms so the comparison remains fair.

Use a consistent proposal review

Create a comparison sheet with the required scope, team, eligibility evidence, independence discussion, timetable, data handling and commercial terms. Record facts and unresolved questions separately. If a reviewer uses a weighted score, define the criteria before reviewing the proposals and explain the judgement behind the final decision.

Retain the RFP, answers, proposals and appointment rationale together. These records help directors explain why the chosen firm suited the company's circumstances. They are also useful when reviewing the engagement after its first reporting cycle.

Turn the shortlist into a clear appointment

When exploring audit firms in Dubai, share the same RFP with each shortlisted provider and request written clarification of material assumptions. The linked provider page is a commercial contact route, not evidence that every engagement requirement has been satisfied.

Before work begins, reconcile the agreed proposal with the engagement letter. Confirm the entities, period, deliverables, responsibilities, fees and process for resolving disagreements. A carefully written request gives the eventual engagement a clearer starting point and reduces misunderstandings that price comparisons alone will miss.

Sources and review

Reviewed 4 November 2026. Process suggestions are general guidance; company-specific legal and tax questions need current professional review.

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