Copyright 2013 Risk Management Stephen Vono, Principal NAPLIA
Copyright The Risk Environment Culture Risk Assessment: Employee & Client Engagement Letters Fraud Cyber Risk
Copyright Culture
Copyright Risk Assessment: Employee & Client First line of defense New client acceptance forms Predecessor accountants Background checks
Copyright Engagement Letters Second line of defense Comprehensive contract: not a fee agreement Purposes: – Define scope of engagement – Mutual responsibilities – Provide for contingencies – Prevent differing expectations
Copyright Percentage of Audit Claims (By Source of Claim)
Copyright Who Commits Fraud? Position in the Organization
Copyright Who Commits Fraud? Median Loss by Position
Copyright Employee Fraud (Opportunity) Experienced employee Lack of segregation of duties Uninterrupted service – Annual vacations not required Weak management oversight
Copyright Client Risk Assessment (Centralizing the Process) Risk assessment committee Must be willing to reject prospects and terminate existing clients
Copyright Cyber Liability
Copyright First Party vs. Third Party Employees Accountant/Owner Client Non-client First Party Third Party
Copyright Professional Liability vs. Legal Liability
Copyright Notification Letter WISP Notification laws Best practices policies – Portal usage
Copyright Thank you! Stephen Vono