Risk management in professional firms Dearman.pdf · the Forensic Special Interest Group of the...
20
www.pkf.co.uk © PKF (UK) LLP David Dearman Partner PKF (UK) LLP Risk management in professional firms Professional Indemnity Conference 4 th to 6 th July 2011
Transcript of Risk management in professional firms Dearman.pdf · the Forensic Special Interest Group of the...
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©P
KF
(U
K)
LLP
Da
vid
De
arm
an
Part
ner
PK
F (
UK
) LLP
Ris
k m
anagem
ent
in
pro
fessio
nal firm
s
Pro
fessio
na
l In
de
mn
ity C
on
fere
nce
4th
to 6
thJu
ly 2
01
1
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©P
KF
(U
K)
LLP2
Ba
ck
gro
un
d
•M
em
ber
of P
KF
’sP
I C
om
mitte
e. S
it o
n the c
om
mitte
e o
f
the
Fo
ren
sic
Sp
ecia
l In
tere
st G
roup o
f th
e IC
AE
W.
•P
art
ner
in t
he f
ore
nsic
serv
ices d
epart
ment
of
PK
F (
UK
)
LL
P –
mo
re t
ha
n 1
5 y
ea
rs s
pe
cia
lisin
g in
la
rge
an
d
co
mp
lex c
om
me
rcia
l lit
iga
tio
n a
nd
in
tern
atio
na
l
arb
itra
tion,
fraud a
nd f
inancia
l in
vestigations,
com
petition
and a
nti-t
rust
investigations,
acquis
itio
n d
ispute
s a
nd
pro
fessio
na
l n
eg
lige
nce
actio
ns.
•C
on
sid
era
ble
exp
erie
nce
of
pre
paring e
xpert
report
s a
nd
ad
vis
ing
in
str
uctin
g s
olic
ito
rs a
nd
Co
un
se
l in
pro
fessio
na
l
ne
glig
en
ce
actio
ns.
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©P
KF
(U
K)
LLP3
Ag
en
da
–ri
sk
ma
na
ge
me
nt
•R
ecru
itm
en
t
•C
lien
t a
cce
pta
nce
•D
uty
of ca
re
•L
ett
er
of
en
ga
ge
me
nt
•R
ecord
ing
of
info
rma
tio
n
•R
ep
ort
/ad
vic
e
•Q
ua
lity c
on
tro
l a
nd
lic
en
sin
g
•A
cce
ss t
o p
ap
ers
•H
old
ing
ou
t
•C
om
pla
ints
, “c
ircu
msta
nce
s”
& c
laim
s
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©P
KF
(U
K)
LLP4
Ag
en
da –
cla
ims
•M
AN
an
d E
RF
v F
reig
htlin
er
v E
rnst &
Yo
un
g
•T
op
te
n a
cco
un
tin
g f
irm
v W
oo
dh
ou
se
plc
•IB
R n
eg
lige
nce
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©P
KF
(U
K)
LLP5
Re
cru
itm
en
t a
nd
tra
inin
g
•S
kill
se
t
•R
efe
rences
•In
duction
•T
rain
ing
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©P
KF
(U
K)
LLP6
Cli
en
t a
cc
ep
tan
ce
•In
itia
l conta
ct/re
quest fo
r w
ork
•D
o w
e w
ant th
is c
lient?
•A
gre
e s
cope o
f w
ork
•W
ho is w
ork
for?
•W
ill a
nyone e
lse s
ee the r
eport
?
•A
gre
e p
rice
•A
re w
e c
om
pete
nt to
do the w
ork
?
•D
ecid
e o
n the s
erv
ice team
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©P
KF
(U
K)
LLP7
Du
ty o
f c
are
•W
ho is the c
lient w
e e
ngaged w
ith?
•A
re they the e
ntity
we a
re r
eport
ing to?
•W
ho e
lse w
ill s
ee the r
eport
/advic
e?
•A
re they lik
ely
to r
ely
on it to
o?
•O
r la
ter
cla
im they d
id?
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©P
KF
(U
K)
LLP8
En
ga
ge
me
nt
lett
er
•A
vo
id d
ou
bt
ove
r sco
pe
of
wo
rk
•C
on
su
lta
tio
n w
ith
le
ga
l te
am
en
co
ura
ge
d
•C
on
su
lta
tio
n w
ith
oth
er
de
pa
rtm
en
ts
•L
imit lia
bili
ty t
o c
lien
t
•L
imit lia
bili
ty to a
ll o
the
r p
art
ies w
ho
mig
ht
rely
on
PK
F
•P
KF
ru
les o
n lia
bili
ty lim
its
•H
igh
ligh
t lia
bili
ty c
ap
at
the
ou
tse
t
•E
nsu
re le
tte
r is
re
turn
ed
sig
ne
d a
nd
un
ch
an
ge
d b
efo
re w
ork
co
mm
en
ce
s
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©P
KF
(U
K)
LLP9
Ind
em
nit
ies i
n c
lien
ts’
term
s a
nd
co
nd
itio
ns
•L
imit lia
bili
ty u
p t
o s
pe
cific
am
ount
vers
us indem
nifyin
g
up t
o s
pecific
am
ount
•In
dem
nity c
lause f
or
death
and p
ers
onal in
jury
•In
dem
nitie
s for
oth
er
losses n
ot accepta
ble
–e.g
. “T
he C
ontr
acto
r shall
be lia
ble
for
and indem
nify
the d
epart
ment fo
r all
expenses, lo
sses, costs
,
cla
ims,
liab
ilitie
s,
pro
ce
ed
ing
s o
r actions a
risin
g o
ut of
the p
rovis
ion o
f th
e s
erv
ices.”
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©P
KF
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K)
LLP1
0
Reco
rdin
g o
f in
form
ati
on
•T
ele
phone n
ote
s
•M
eeting n
ote
s
•E
ma
ils
–do t
hey c
onta
in a
dvic
e?
–does it
say w
hat
you m
eant?
–h
ave
yo
u f
ollo
we
d P
KF
pro
ce
du
res in
se
nd
ing
it?
–does it
say m
ore
than it
should
(N
.B.
Data
Pro
tection
Act
and inte
rnal em
ails
)?
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©P
KF
(U
K)
LLP1
1
Re
po
rt/a
dv
ice
•C
heck that re
port
/advic
e is a
ddre
ssed to the r
ight
part
y (
the o
ne w
e e
ngaged w
ith)
•D
o w
e n
eed to r
estr
ict th
e r
eport
?
•O
ral/w
ritten
•A
re a
ll necessary
caveats
inclu
ded?
•H
ave w
e d
one the w
ork
to justify
the r
eport
?
•C
PR
and C
rPR
consid
era
tions for
fore
nsic
work
•A
re the w
ork
and r
eport
covere
d b
y the
engagem
ent le
tter/
contr
act?
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©P
KF
(U
K)
LLP1
2
Qu
ali
ty c
on
tro
l
•Lic
ensin
g
•P
rocedure
of part
ner
sig
n o
ffs
•T
echnic
al support
•H
ot and c
old
file
revie
ws
•R
isk m
anagem
ent te
am
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©P
KF
(U
K)
LLP1
3
Ho
ldin
g o
ut
•G
lob
al b
usin
ess?
N
O
(PK
F (
UK
) L
LP
is a
me
mb
er
of P
KF
In
tern
atio
na
l, a
n
asso
cia
tio
n o
f le
ga
lly-i
nd
ep
en
de
nt
firm
s)
•H
old
ing
ou
rse
lve
s o
ut
•A
llow
ing
oth
ers
to
ho
ld u
s o
ut
as t
he
ir
pa
rtn
ers
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©P
KF
(U
K)
LLP1
4
Co
mp
lain
ts, “c
irc
um
sta
nc
es
”&
cla
ims
•P
roce
du
re in
PS
M m
ust
be
fo
llow
ed
•Im
me
dia
tely
on
be
co
min
g a
wa
re:
–sta
ff m
ust
info
rm c
lien
t p
art
ne
r
–p
art
ne
r m
ust
info
rm P
I p
art
ne
r (o
r le
ga
l co
un
se
l):
no
w in
clu
de
s
qu
alit
y,
pro
fessio
na
l &
pe
rso
na
l co
nd
uct
issu
es,
no
t ju
st
PI.
•C
laim
or
po
ten
tia
l cla
im
–d
o n
ot
resp
on
d u
ntil P
I p
art
ne
r/le
ga
l co
un
se
l g
ive
s a
uth
ori
ty
•R
eg
ula
tory
co
mp
lain
ts
–im
me
dia
tely
in
form
Ch
air
ma
n o
r M
an
ag
ing
Part
ne
r (o
r if a
wa
y,
PI
pa
rtn
er)
an
d s
en
d c
op
y o
f le
tte
r
•P
rivile
ge
–A
vo
id d
am
ag
ing
dis
clo
su
re b
y f
ollo
win
g P
SM
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©P
KF
(U
K)
LLP1
5
Ide
al
as
sig
nm
en
t?
•F
or
a g
ood c
lient
•W
ith a
gre
ed s
cope a
nd fee, lim
ited lia
bili
ty in
pro
port
ion to fee, w
ork
we a
re c
om
pete
nt to
do
•P
erf
orm
work
pro
perly (
inclu
din
g r
ecord
ing
necessary
info
rmation)
•R
eport
to c
ontr
acte
d p
art
y (
restr
icting a
bili
ty o
f
oth
ers
to r
ely
on r
eport
)
•Is
sue b
ill a
nd r
eceiv
e p
aym
ent
•W
ait for
cla
im (
up to 6
years
, m
aybe longer!
)
secure
in k
now
ledge w
e’v
e d
one o
ur
best
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©P
KF
(U
K)
LLP1
6
Cla
ims
–le
ss
on
s le
arn
ed
MA
N a
nd
ER
F v
Fre
igh
tlin
er
v E
rnst &
Yo
un
g
•Re
ce
ipt
of
late
in
form
atio
n a
fte
r th
e c
om
ple
tio
n o
f a
ud
it
fie
ldw
ork
.
•Fe
e p
ressu
re.
•Sig
nin
g o
ff p
ressu
re –
fro
m p
are
nt
an
d o
ve
rse
as a
ud
ito
rs.
•Co
nsid
era
tio
n o
f th
e c
om
pe
ten
ce
of
the
clie
nt
tea
m in
ris
k
asse
ssm
en
t a
nd
assig
nm
en
t p
lan
nin
g.
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©P
KF
(U
K)
LLP1
7
Cla
ims
–le
ss
on
s le
arn
ed
To
p t
en
acco
un
tin
g f
irm
v W
oo
dh
ou
se
plc
•Clie
nt
rela
tio
nsh
ip (
ob
jectivity a
nd
in
de
pe
nd
en
ce
).
•Pla
nn
ing
an
d a
de
qu
ate
pro
ce
du
res.
•Re
co
rdin
g w
ork
do
ne
in
acco
rda
nce
with
th
e s
co
pe
.
•Sco
pe
ve
rsu
s c
lien
t e
xp
ecta
tio
ns.
•All
is n
ot
lost
with
a g
oo
d f
ore
nsic
acco
un
tan
t!
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KF
(U
K)
LLP1
8
Cla
ims
–le
ss
on
s le
arn
ed
Ind
ep
en
de
nt
Bu
sin
ess R
evie
ws (
IBR
s)
•Sco
pe
v e
xp
ecta
tio
n.
•Fe
es.
•Dis
cla
ime
rs.
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©P
KF
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K)
LLP1
9
Qu
es
tio
ns
?
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©P
KF
(U
K)
LLP
Da
vid
De
arm
an
Part
ner
PK
F (
UK
) LLP
Ris
k m
anagem
ent
in
pro
fessio
nal firm
s
Pro
fessio
na
l In
de
mn
ity C
on
fere
nce
4th
to 6
thJu
ly 2
01
1
