March 2nd Meeting Minutes, Chuck Palmer, Heartland

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Melissa Barton, our vice president, started the meeting.  She had those present introduce themselves.  Today’s guest speaker was Chuck Palmer with Heartland who discussed the timely topic of professional liability.  Chuck owned a business performing outsourced CFO services.  Chuck provided a real-life example from his personal experience of a roofing company that needed bookkeeping services.  The relationship with the roofing company was positive until a general manager was later hired.  As the relationship was ending, a final bill for $6,700 was submitted by Chuck’s company but the bill went unpaid.  The roofing company filed a lawsuit against Chuck’s company alleging 26 points in a letter.  Of the 26 points, 25 were incorrect and the one correct point was already addressed.  The case went to court.  In the end, the lawsuit was dropped and the bill was written off.  In many cases, litigation has more to do with emotions than facts. Two questions were raised.  First, how do we prevent litigation from occurring?  Secondly, how do we resolve litigation?  One critical step in preventing litigation is screening clients during the client acquisition phase.  Questions you may wish to ask a potential client include:

  1. Why are you looking for a new accountant?
  2. Ask for a copy of the QuickBooks file to review the file for problems.
  3. Use a professional services engagement letter and be as specific as possible
  4. Be clear that business management is not included
  5. Recommend an automated payment policy for payment of fees
  6. Have a solid insurance company. Understand what is covered and what is not.  Sit down with your agent to review your insurance coverage.

Communication and documentation are key.  Email your understanding to your client.  You may also wish to run a bank reference check before acquiring the client.  Document retention is very important.

Linda Lagraff asked how to deal with liability in an engagement letter for clients that provide bank account and credit card access to bookkeepers and accountants.  One suggestion was to recommend password security in an engagement letter.  Another comment recommended use of read only access for bank and payroll for bookkeepers and accountants.

We are looking for speakers for upcoming meetings.  Kim will be the speaker for April and the topic is “What is your Super Power/Niche?”  If you don’t know, we’ll help you discover it.

Our group will continue to meet at the Meals on Wheels site until we have space on the eastside of Portland for 25 to 30 people.

Bullet Points:

  • Melissa Barton, our vice president, started the meeting. She had those present introduce themselves.
  • Today’s guest speaker was Chuck Palmer with Heartland who discussed the timely topic of professional liability. Chuck owned a business performing outsourced CFO services.  Chuck provided a real-life example from his personal experience of a roofing company that needed bookkeeping services.
  • The roofing company filed a lawsuit against Chuck’s company alleging 26 points in a letter. The case went to court.  In the end, the lawsuit was dropped and the bill was written off.  In many cases, litigation has more to do with emotions than facts.
  • Two questions were raised. First, how do we prevent litigation from occurring?  Secondly, how do we resolve litigation?
  • One critical step in preventing litigation is screening clients during the client acquisition phase.  Questions you may wish to ask a potential client include:
  1. Why are you looking for a new accountant?
  2. Ask for a copy of the QuickBooks file to review the file for problems.
  3. Use a professional services engagement letter and be as specific as possible
  4. Be clear that business management is not included
  5. Recommend an automated payment policy for payment of fees
  6. Have a solid insurance company. Understand what is covered and what is not.  Sit down with your agent to review your insurance coverage.
  • Communication and documentation are key.
  • Linda Lagraff asked how to deal with liability in an engagement letter for clients that provide bank account and credit card access to bookkeepers and accountants. Suggestions included recommending password security in an engagement letter and use of read only access for bank and payroll.
  • We are looking for speakers for upcoming meetings. Kim will be the speaker for April and the topic is “What is your Super Power/Niche?”
  • Our group will continue to meet at the Meals on Wheels site until we have space on the eastside of Portland for 25 to 30 people.