A short discourse on random and statistical risk. by Bruce W. Marcus Author of Professional Services Marketing 3.0 Risks are different in context and magnitude. A good mathematician can often statistically quantify the boundaries of risk, such as telling you that one in every hundred people will slip in the bathtub and break a bone, but that depersonalizes it and tells you nothing to help you avoid it. And that’s only half way to understanding it. More for CPA Trendlines PRO members: The Three Degrees of Risk • Four Essential Habits for Building Client Trust • The Nine Hallmarks of a Marketing Culture • The Four Cornerstones to Building A Marketing Culture • Getting the Client is [...]
R-I-S-K: It’s amazing that so simple a four-letter word can be so complicated. by Bruce W. Marcus Professional Services Marketing 3.0 There are risks with dire consequences and risks with negligible consequences. There is risk in every human enterprise; in every trade or endeavor. We take risks, in varying degrees (and sometimes unwittingly) every day or our lives. There is even risk inherent in getting out of bed in the morning. But what – on any level – does risk really mean? Can risk be tamed? More Professional Services Marketing 3.0: • The Four Cornerstones to Building A Marketing Culture • The Nine Hallmarks of a Marketing Culture • Getting the Client is Only Half the Battle • Practice Development: [...]
Strategy 2012: Battling for Market Share What are your critical challenges for 2012, and what can do you about them? A number of the profession’s leading lights have been sharing their thoughts with Accounting Today. Here’s one: Charles Postal Santos Postal & Co. We see a shrinking market share of small and medium-sized businesses with the need for premium accounting services caused by increased competition from larger firms with greater resources.
New evidence suggests many CPAs are ignoring malpractice risks. by Kathleen S. Long Montage Analytics In research on causes underlying accountant professional liability, we are discovering an alarming phenomenon: practice risk apathy. We are finding that a statistically greater than expected number of CPAs are apathetic to practice risk management. Early results indicate that while CPAs gobble up “war stories” and “top ten lists” about risk management, getting them to examine their own practices and make risk management an action item is a different matter altogether.
Including one “silver bullet” to help auditors and accountants make sure that companies get what they pay for. by Rick Telberg The coming decade may well redefine the role of the internal auditor in corporate governance, according to one widely followed expert. “Internal audit is getting more strategic,” Dan Swanson, a 26-year veteran of the profession and a former director of professional practices at the Institute of Internal Auditors, told me. “It’s not seen as strictly a policing function as it was 10 years and 20 years ago.” Swanson sees accountants in internal audit becoming “more involved in the overall business and the strategic direction of the organization.” He sets out a new, expansive and challenging role for internal auditors.
Let this be a warning to CPAs working in forensics at a risky company. This comment post is such an amazing and frightening story that we thought it was worth a full post of its own. It comes in response to Be a Hero, Not a Chump. Currently I am in year 3 of fighting a Chapter 11, now Chapter 7 filing. Our firm consists of three very experienced practitioners with approximately 80 years of aggregate experience. Collectively we have CPA, CFE, JD, MS, and BBA degrees. My wife and I are now working on MS degrees in digital forensics. This was brought about by an agreed-upon procedures engagement involving an oil and gas drilling company that we took on [...]
Camico, the California-based malpractice insurer, describes five ways CPA firms can increase their exposure to lawsuits and what preventative measures to take. Highlights: 1. Accounting rules: While accounting rules don’t require certain procedures, e.g., confirmation of information in a compilation engagement, juries may not take that rule into consideration. So if something doesn’t seem right to you, it is best to do some probing and make sure it is right. Then be sure to document it and communicate it. 2. Documentation: If you advise a client to take certain steps, or to avoid certain actions, put it in writing and send it to the client. Juries may conclude that if the advice was not written, it was not given. 3. [...]
Which side of the equation would you rather be on? When James F. Reeves talks, people listen. Not only is he a brilliant forecaster for the profession, but as senior vice president for product development at Thomson Reuters’ PPC, he can help make the future happen. Today he forecasts a “tsunami” of new regulation following the credit debacle, reckoning: The volume of new regulation affecting American business is growing exponentially, and while regulatory compliance can be both costly and painful, noncompliance is a significant risk, a fact not lost on senior executives. Nevertheless, most companies have not institutionalized an enterprise-wide risk management system. The maturation of enterprise risk management into a more strategic governance, risk management, and compliance function provides [...]