Risk management

Regular check-ups

How often do you have someone auditing your files? Once a year? Once every two years? File audits are not just a good idea, they are a necessity if you want to find out where your practice is falling down when it comes to client care and work.

However, one misconception is that file audits have to be done by an outside firm, which can put practices, especially smaller ones off the idea because of the expense and time.

This is not necessarily the case - a file audit can be done by anyone within your own firm.

You can either ask one of your colleagues to pick out a random file and check it is fully comprehensive, or even do it yourself.

You could have a rota where each partner chooses a random file once or twice a month and carries out the audit, or you could allocate one person to do the audit on five to ten files every six months.

When carrying out an audit, one important tool is a checklist.

It may be that one partner always forgets to do something, such as printing out and filing e-mails.

The person responsible for the audit may automatically pick up on this, yet if something has been forgotten, the discrepancy in the file may go unnoticed.

The checklist should cover every possible area of work which should be contained within the files.

For example:

- All e-mails;- Notes of all telephone conversations between the client or third parties;- All correspondence;- Completion dates for all aspects of the case;- The retainer letter;- A list highlighting timings of when telephone calls or letters need to be made or sent;- Any third party information;- Invoices.

We often advise clients to keep this simple check list in the front of all files, so when the file is opened it is immediately apparent what has been done and what needs to be done, and makes the process far easier and quicker to audit.

There is no point in doing regular file audits if nothing is done about any discrepancies which are found.

We are not advocating a name and shame culture, only suggesting any file mistakes which are found should be documented and analysed.

It may be the whole firm is making the same mistake, or it may be that one partner is continually making the same mistake.

These mistakes can then be relayed to the relevant parties and, ultimately, they will reoccur less frequently.

File audits are an often ignored part of risk management procedures.

However, it is important to remember that regular file audits pinpoint problems which can sometimes be remedied before it is too late, and prevent a negligence claim being made.

This column was prepared by the Alexander Forbes Professions risk management team