Sunday, August 03, 2008

What we do and what we don’t do

We thought it might help to give you a brief reminder of the work we do for our clients and explain why we don’t do some work that we are often asked about. To make it easier on the eye, we’ve broken it up into sections:

What we do

The simple description is ‘pretty well what you want’, but a typical visit starts with a plan, prepared beforehand from case details and other information gathered about your practice.

We then attend for anything from one to six person days to review cases, systems, or non-case related areas like clients’ accounts, PII, etc. The visit length depends on your needs. If you approach us with plenty of time before your next regulatory visit, we can plan a series of smaller visits spread over three years or more that will cover everything in manageable bites so that you can fix anything we find before we come up with new areas for improvement. If you leave it later and need to cover more, we can usually do it, but we cap all of our visits at 6 working days (two of us for three calendar days) because you won’t be able to address all of the deficiencies we would find in a longer visit and our wives and kids need us to turn up every now and again to remember who we are.

We finish the visit with a report letter and a report summary. The letter concludes the visit and recommends main areas for disclosure to your regulator and a plan for future visits. The summary sets out everything we have found in a colour coded ‘action plan’ format to help you prioritise and deal with each issue.

But it doesn’t stop there....although you only pay for the time we are in your practice, we continue to support you once you are clients. We are on the end of a phone or available by email to help review documents you have produced to address deficiencies, help with odd technical queries that arise from time to time and generally provide assistance when you need it. Most of this work is done without charge and if we think that you need so much doing that we may have to charge you, we always clear it with you before we go ahead.

And we’ll try anything, if you ask us to....although we do so reluctantly (see “what we don’t do and why” below) we will turn our hand to anything you want, as long as it is legal and vaguely interesting. We have helped produce standard documents, design filing systems and provided focussed training on occasions. I’ll not try to claim it is our core business, but it makes a pleasant diversion from picking holes in your files and can help make compliance more than a necessary evil.

Why we do what we do

We love it! No, really, someone has to and we get a buzz out of helping IPs avoid trouble in the first place, or getting them out of trouble if they are already mired in their regulator’s clutches. Each regulator has a slightly different approach, but our input can be significant.

If you are regulated by ICAEW, our main plan, visit, report package was designed with their annual insolvency compliance review (ICR) requirement in mind. We may play around with it to suit the needs of the particular practice, but at the heart of it is a firmly held belief that only a truly independent ICR can be thorough enough to protect you.

If you are with the IPA, our reviews can complement the annual self-certification process. We promised the late and greatly missed Nick Sabin that we would not review the actual self-certification cases and complete the IP’s return, as he considered that it was an essential discipline for all IPs to really inspect a selection of their cases in detail each year. What we do instead is stagger our visits to avoid the self-certification case selection and allow an IP to identify systemic issues and other risks on similar, but not identical cases. If done before the annual return, these areas can provide the backbone of the self certification review, highlighting likely areas of weakness and allowing a briefer review of case-specific issues. If done after the self certification return, our review may highlight areas that were missed and give you the opportunity to “own up”. It has to be better to send in a late amendment to a return than to wait until the monitors subsequently find what you missed.

If you are with one of the other regulators, even though they have no annual review requirement, they will notice a significant improvement if you have used us and implemented our recommendations. Two clients recently had regulatory visits that illustrate this. One had their visit cut short when the monitor could not find anything worth reporting and the other ended up with one of the shortest reports we have ever seen!

What we don’t do – and why

We don’t generally produce standard letters, checklists or other documents. Since so many people ask us to, this may seem a little contrary, but we have good reasons for this approach.

The first reason is that we are in and out of so many practices, that there could be an element of plagiarism in anything we produced. We would never deliberately copy another IP’s work, but it is impossible to forget a really good piece of work and this could creep into anything we drew up.

The second reason is that every practice’s needs are slightly different. Look at the problems that the Insolvency Service and BBA had in persuading a small selection of IPs to agree on a set of standard terms to support the IVA protocol and you will see what we mean. We could only ever produce something that addresses 80 to 90 percent of any one practice’s needs and there is something inherently unsatisfactory in such an approach.

Thirdly, and possibly the most important of all, it might compromise the independence of our reviews. Time and time again on our visits we find errors in a practice’s documentation that internal reviews have not spotted. Familiarity not only breeds contempt, but also blindness. If we designed a form, any review that we subsequently did would be coloured by that involvement. For example, we produced a set of proposals to meet the SIP 3 compliance gaps in the SCIVA protocol and standard terms, but then found it very difficult to review it when it arose on a recent visit to a client’s practice. We did find some issues that we are currently amending and will free issue to those who have the proposals, but it was a hard thing to do and we would not want to face the same issues across a practice’s entire letter pack.

Finally, if we are honest, there is no commercial angle in it for us. If we came up with a standard document, it would have a very short shelf life because IPs traditionally ‘borrow’ each other’s ideas when they see them in reports and other notices.

Having said that, there is a distant hope for those of you young enough to wait for us to get around to it. We are at the very earliest stages of playing with a concept that could combine our compliance orientated view of the insolvency world with an IP’s years of practical experience. We would like to bring some of the ideas into focus and then explore the concept with some of the software providers before deciding whether to go ahead, but we may have something ready in a couple of years??