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Tag Archives: engagement letters

Limiting Malpractice through Scope of Engagement

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by guest bloggers Jennifer H. Feldscher and Seth L. Laver. A recent NY Appellate Division decision serves as another reminder of the importance of carefully defining the scope of engagement in an engagement letter. This is because, under New York law, an attorney may not be held liable for failing to act outside the scope […]

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Using Indemnification Clauses to protect your firm

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by Rickard Jorgensen, FCII, ARM, ACIArb All CPAs know that a signed engagement letter is a crucial tool in the defense of a professional negligence lawsuit. The engagement letter memorializes the terms of the engagement, details what services you are performing and more importantly, the services you are NOT offering (i.e. you will not detect […]

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Control of client funds

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by Rickard Jorgensen, FCII, ARM, ACIArb If your CPA firm has control of client funds and can write checks on clients’ bank or investment accounts you may have an exposure to CPAs or firm staff abusing the signatory authority by stealing or misusing the client funds in the firm’s custody and control.  This could apply to bill […]

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Using the engagement letter to reduce cyber liability exposure

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By Nick Matarazzo In this digital age, accountants are being forced to deal with all sorts of cyber threats. A well-worded engagement letter can help guard you against a cyber-related liability claim from your client and minimize your overall firm liability. Even if you are careful about your clients’ data, you may still be held […]

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How To Minimize The Damage Of Lawsuits

by Rickard Jorgensen, FCII, ACIArb., ARM   Things Beyond Your Control That Precipitate Lawsuits With the advent of the computer era and information age, the cultural and business climate of the nation, and world, has shifted. Businesses have become more complicated, as attitudes sanction greater and greater risk-taking. No longer are there sure-fire lifetime jobs […]

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An overview of the client screening process

By Rickard Jorgensen, FCII, ACIArb, ARM Extracted from Evaluating Clients – Engagement risk screening for CPA firms. There are solid reasons for screening new clients.  Many involve not getting paid, exposure to lawsuits or even the stress related to difficult individuals.  Effective client screening can avoid these problems. Implementing a formal screening process is the […]

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ADR Provision in Engagement Letters – a new approach

You may recall the blog posting about the Mediation Clause recommended by Ralph Picardi (go here for a link to the post). Recently certain firms have enjoyed success by augmenting this provision with a section step which essentially provides rules for the resolution of a claim or fee dispute by Arbitration.  While Arbitration as a process has limitations, […]

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Fee Collection – a malpractice risk

Counter suits arising from fee disputes are one of the most common sources of malpractice claims against CPAs. In fact, such suits are a great risk for many professionals. Any steps taken to avoid a collection becoming a malpractice claim are essential. One of the key areas of attention should be a documented Collection Procedure.  […]

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How to get sued……

There have been many articles about how to avoid law suits and what you should not do to attract problems with clients. So with a tongue firmly implanted in the cheek, we thought it would be fun to tell you what you should do to get sued. Accept an assignment that is beyond your expertise […]

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Engagement letters – what should they contain

Every trial attorney will tell you that the first and most important tool in the defense of a malpractice claim against a CPA is a strong and carefully crafted engagement letter. This was brought home last week with one of our long-standing CPAGold™ clients. For years the CPA had provided corporate tax filing services to […]

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