How to Analyze & Quantify Risk on a Client File
Know what you are getting into before you take on that new client
One of the many challenges faced by public practitioners in today’s business and accounting environment is trying to determine how risky a new client is to take into your firm.
With over 20 years of public practice experience, what I can tell you is that you should not just accept anyone and everyone that comes through your door. Or, if you do, you should at least be aware of what you may be in for. That’s what this seminar is all about.
The brutal fact is that if you underestimate the risk associated with a client’s tax and financial position you run the risk of:
- being underpaid for your services due to the extra unanticipated work you will be required to do
- being exposed to potential liability even if you have inherited the file from another accountant or bookkeeper
- having many stressful and sleepless nights over how to fix problems you have inherited and dealing with a client who may be unaware of the issues
In this Skill Snack Seminar, I will provide you with a methodology that you can apply to those new clients that you inherit from another practitioner.
Included is a useful spreadsheet tool that I will take you through step-by-step to guide you through this analysis. You can then customize and incorporate the tool into your own practice and change it as you see fit to comply with your own thought process.
With this simple, yet powerful, checklist you will come up with a multiplier for your normal fees. In short, it will give you a glimpse into the future when dealing with this client.
Ian DINovo is a professional accountant and Director of the Canadian Tax Academy. He has been practicing accounting and offering independent financial and business advice for over 15 years.
He is the creator of a number of courses dealing with business, tax and investment matters that are designed to make difficult topics easy to understand for everyone.
Frequently Asked Questions
StartAnalyzing the risk in a client file and what it means to your practice (6:12)
StartStep One - General and personality and do you mesh (4:51)
StartStep Two - Cursory overview of the financial statements & worst case scenario (9:40)
StartStep Three - Detailed look at the books and records (5:15)
StartOverview of the spreadsheet tool and how to use it (4:11)
StartReview of the system and scoring - review of the questions (16:56)
StartReview of a small business client example (11:59)
StartReview of the system and scoring - review of the questions (11:33)