The direct consulting services we provide may take many forms, but generally comprise the engagement letter review and the risk management audit. In each case, the accounting firm (rather than the carrier) retains us and pays our fixed fee, with the intent to establish a privileged relationship.

 

Engagement Letter Review

Whereas the hotline offers the opportunity to obtain feedback on specific issues concerning engagement letters or comments on a single draft engagement letter, the engagement letter review service offers the opportunity for a complete, thorough analysis of the engagement letter templates an accounting firm uses in its practice. Because engagement letters are one of the principal lines of defense in accounting risk management, this service is a valuable one.

 

Risk Management Audit

The risk management audit has no connection to traditional audit services performed by CPAs or governed by standards of the accounting profession. It is, rather, a process of analyzing an accounting firm’s claim/incident history, assessing its existing risk management program, and providing a series of recommendations for strengthening that program. It includes investigation of the accounting firm’s website and select documents, interviews with key professionals and administrators, and preparation of a written report.

 

During phase three, we synthesize the gathered information into a comprehensive report to the accounting firm, focused principally on lessons to be drawn from claim/incident experiences, and a detailed set of targeted risk management recommendations.

 

Having found that accounting firms undergoing this audit process become better risks in the future, many carriers make the audit a condition of writing or renewing policies for accounting firms that have less than optimal claim/incident experience, or practices exposing them to heightened risk.