Understand your firm's risk profile.

Author:Gartland, Daniel J.
 
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No service, industry, area of practice, or CPA is immune from a professional liability claim. Fortunately, information is power. This infographic provides data that CPA firms can use to evaluate the risks in their practice and help address them appropriately. The numbers are based on claims data for 2017.

Information to help reduce the likelihood of a claim in a CPA firm:

Knowledge of the potential causes of loss for an engagement may provide the necessary awareness to help avoid those same issues, as well as the ability to plan and manage the exposure on future engagements.

Top 3 causes of loss by area of practice:

Tax planning and compliance services

  1. Failure to advise/improper advice

  2. Filing errors

  3. Failure to detect theft or fraud

    Audit and attest services

  4. Failure to detect misstatement or disclosure errors

  5. Failure to detect theft or fraud

  6. Failure to advise/improper advice

    Consulting and other services

  7. Failure to advise/improper advice

  8. Failure to detect theft or fraud

  9. Breach of fiduciary duty

    'Claims are like art: The more they age, the more expensive they become.'

    --Rebecca Toffolon, Esq., director, CNA Accountants Professional Liability Claims

    'Reporting claims early can give you the opportunity to gain insights from others; sometimes this includes experts in the field, and that early analysis may be key to resolving a claim --sometimes even before litigation is filed.'

    --DianneWainwright, Esq., partner, Margolis Edelstein

    Daniel J. Gartland (daniel.gartland@cna.com) is a risk control consultant at CNA. Continental Casualty Co., one of the CNA insurance companies, is the underwriter of the AICPA Professional Liability Insurance Program. Aon Insurance Services, the National Program Administrator for the AICPA Professional Liability Insurance Program, is available at 800-221-3023 or visit cpai.com.

    Claims asserted against CPA firms in the AICPA Professional Liability Insurance Program, by...

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