Responding to Audit Inquiry Letters Working with Your Client to Provide Full Disclosure While Protecting Sensitive Information

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It’s “that time of year” again. No, it’s not tax season, but rather the time for your client to prepare its audited financial statements and requisite disclosures to the Securities and Exchange Commission (SEC) and/or any other party to which it agreed to provide an annual audit.1 As part of this disclosure, your client has asked its accountant to prepare financial statements and issue an opinion that these statements fairly present the true financial picture. The accountant, in turn, sends you and/or your client an “audit inquiry letter” that asks you to describe any event that may affect your client’s financial status, including pending and potential litigation. The most likely next step is for your client to send you a letter that simply requests that you respond. Typically, this would be the extent of your client’s involvement in this process because it has confidence that you can accurately describe the matters that you are handling, or have discussed potentially handling.

Audit Engagement Letter

However, despite a split of authority, many courts hold that the response to the audit inquiry letter waives the attorney-client privilege and/or the work product doctrine. Thus, the response, drafts and underlying documentation could be discoverable by your client’s adversary in litigation and/or your client’s creditors.2 In order to limit the potentially damaging impact that the disclosure of such sensitive information can have, you need to implore your client to take an active role and work in concert with you to carefully craft a reply that is at once forthcoming and at the same time preserves their rights.

When your client’s accountant prepares the financial statements and issues its opinion on them, the accounting firm must comply with, among other things, Statement of Financial Accounting Standards Number Five (FAS 5) and Statement on Auditing Standards Number 12 (SAS 12). FAS 5 establishes standards of financial accounting and reporting for loss contingencies and provides that “one such loss contingency is pending or threatened litigation.”3 SAS 12 gives the accounting firm guidance on the procedures that it should consider for identifying litigation, claims and assessments and satisfying itself that the financial accounting and reporting for such matters is in accord with the generally accepted auditing standards.4 SAS 12 requires disclosure of (1) a list that describes and evaluates pending or threatened litigation and (2) a list that evaluates claims that have not yet been asserted.

Given that these statements command the accountant to gather as much information as possible, you and your client should be aware that there is no federal accountant-client privilege as a matter of federal common law and no such privilege under Federal Rule of Evidence 501.5 In fact, the U.S. Supreme Court has expressly disapproved of the so-called accountant-client privilege, stating that “no confidential accountant-client privilege exists under federal law, and no state-created privilege has been recognized in federal cases.”6 Most states do not recognize an accountant-client privilege. Thus, without any other applicable privilege, information that is provided to the accountant could be the subject of discovery by a litigation adversary or a creditor.

How Much Will My Divorce Cost and How Long Will It Take?

Results from Nolo’s nationwide divorce survey—typical hourly fees for divorce attorneys, total divorce costs, how long the divorce process takes, and more.

If you’re facing the end of your marriage, you have a lot of concerns. One of your questions is likely to be: How much will a divorce cost? The answer to that question will depend on many different things, including whether you hire a lawyer (and if so, how much that lawyer charges), whether your spouse is combative or collegial, whether you have children at home, how much property and debt you have to divide between you, whether one of you is requesting alimony—and the list goes on. It’s a similar story if you want to know how long your divorce might take.

Nolo is in a unique position to gather information about what actually happens in divorce cases across the country. Thousands of people visit and other Nolo sites every day, seeking legal information about divorce and looking to connect with divorce attorneys. We contacted people who had visited our sites over the past few years (and provided their emails when researching lawyers), asking them to participate voluntarily in a survey about their divorce cases.

See All Our Survey Results

This article summarizes the highlights of our divorce survey. See our legal costs and outcomes page to learn more about the results of this and other surveys we’ve conducted on a wide range of legal issues, including personal injury claims, bankruptcy, DUI cases, workers’ compensation, wrongful termination, and Social Security disability.


The divorce survey asked readers about a number of things, including:

  • how much their divorce attorneys charged per hour
  • how much they spent in total divorce costs
  • the number of issues that they resolved through a settlement or trial
  • how long the divorce process took from start to finish, and
  • their level of satisfaction with the outcome.

Here’s what we learned from their answers.

Hourly Rates for Divorce Lawyers

Although most people would prefer to have an attorney by their side when going through a divorce, many also worry about how much this will cost. Even if you’ve called around or visited the websites of various divorce attorneys, you may still wonder if a lawyer is charging too much, or even too little (which could be an indication that the lawyer doesn’t have enough experience or is desperate for clients).

Nationwide, the readers in our survey reported paying their attorneys an average of $270 per hour. However, individual rates varied a lot. Although nearly seven in ten readers (69%) paid between $200 and $300 an hour, about one in ten (11%) paid $100 per hour, and two in ten (20%) paid $400 or more. Our separate study on hourly rates reported by family lawyers across the U.S. showed significant regional differences, with the highest rates reported by attorneys in coastal metropolitan areas. The same study also showed that rates were higher for more experienced attorneys—no big surprise there—and that about half of family law attorneys offer free consultations for potential new clients.…

7 Steps To Choosing The Right Divorce Lawyer

How to Discover A Good Divorce Lawyer

It’s difficult to know where to turn when you’re faced with divorce. Few of us have any prior experience with the legal ins and outs associated with this difficult process. In my divorce coach practice, I’ve heard too many stories of time and money wasted as clients go through lawyer after lawyer trying to find the right one. And yet, finding the right divorce lawyer is key to what could be a faster, less-expensive divorce, compared to a long, drawn-out emotional and financial nightmare. But if you don’t know what to look for in a divorce lawyer, how do you know you’re investing all of your money, hopes and dreams in the right one?

Follow these seven steps to find the divorce attorney that’s the right fit for you:

1. Be realistic.

First, you need to realize that divorce is a legal process with the sole purpose of dissolving your assets and resolving custody issues. Your divorce attorney’s job is to represent you to the best of his or her ability in this process. While you might want them to listen to your anger, frustration, pain and sadness, that is not their job. They are not trained to be your therapist or coach, and they don’t want to be. Since your attorney has higher rates and the clock is always running, it’s a gross misuse of your money if this is how you’re using them. And divorce attorneys have seen it all. What seems immensely important to you might barely register for them within the scope of the legal process. So be realistic about the role of your divorce attorney, and what you can expect from them.

2. Stay focused on the goal.

Your ultimate goal in this process is to get divorced, and hopefully, you can do so without any major depreciation of your lifestyle. Don’t let your emotions jump in and run rampant when it comes to negotiating over material things that don’t mean much to you in the big picture. If you do, your divorce will be longer, more litigious, and definitely more expensive than otherwise. Is it worth it? No. So keep your focus on getting divorced as quickly, and with as little financial damage, as possible. Ask yourself, what kind of divorce will do that for me?

3. Know what you want.

Before you rush out to hire a divorce attorney, consider other alternatives to traditional litigation. If you aren’t completely entangled with children and finances, you could hire a mediator to help you negotiate the terms of your divorce. Mediation is the fastest, cheapest way to get divorced, and you might not need to hire an attorney at all! If your negotiation is more complicated, you’ll have to hire a divorce lawyer to negotiate a settlement with your spouse’s attorney. Or you could consider a collaborative divorce. A collaborative divorce is focused on negotiation with the goal of preserving a co-parenting relationship. Your last resort is a litigated trial. Typically, these are the cases when neither side will compromise.


Few events in life can be as stressful and traumatic as a divorce. Along with riding an emotional roller coaster, you face significant legal and family consequences. During a divorce, it is essential to have an experienced divorce lawyer who can help you navigate this uncertain time and achieve the outcome you deserve.

To determine whether a candidate is a right fit for you and your situation, you should know what important questions to ask a divorce lawyer during your initial consultation. Below, we include seven of the key questions to ask your divorce lawyer during your first meeting.

How to Find a Good Divorce Lawyer | Terry & Roberts

1. How Will We Communicate Throughout the Case?

One of the questions to ask a divorce attorney on the first visit is about how you will communicate throughout your case. Being able to communicate regularly with your attorney is essential to a successful case. An attorney should let you know how long you may wait for a response, which can spare you from feeling frustrated later on.

You and your lawyer should also discuss communication preferences. Communication may take the form of:

  • Emails
  • Phone calls
  • In-person meetings
  • Videoconferencing

If you prefer phone calls, but the attorney prefers electronic communication, they may not be the right fit. A good attorney will be willing to customize their communication style to your preferences and to what is appropriate for the situation and information. For example, in some situations, a short email may be sufficient, while other situations may call for a face-to-face meeting.

This is also the time to ask whether you will be communicating with support staff, such as a paralegal, legal secretary or legal assistant. If you will be communicating with support staff, ask about their credentials and who will handle different aspects of your case. The amount of communication you may need to have with your attorney also depends on the complexity of your case. If your case is more complex, you and your attorney will likely be communicating more often.

You should feel comfortable with an attorney’s responsiveness, especially if a time-sensitive matter or emergency situation arises. You should also feel confident that your interests are being represented by every member of your legal team.

How to Discover A Good Divorce Lawyer

2. How Much Experience Do You Have and Will There Be a Team Behind My Case?

Another question to ask a divorce lawyer at the first meeting is about how much experience they have. Does this attorney specialize in divorce cases? You deserve a lawyer who understands the legal process for divorce in your state and has experience successfully handling these cases.

A general practice attorney may not be the best choice for legal representation in a family law case. If you have a child, ask the attorney about how experienced they are with child support and child custody. An attorney with the expertise you need will thoroughly understand the divorce process, know how to speed up the process and be able to effectively work with court personnel and other attorneys if you and your spouse end up in court to divide assets, child support and custody.…

What Makes a Positive Law Firm Culture?

Law firm culture is an extremely important factor when it comes to the success of a business and the wellbeing of its employees – yet it is commonly overlooked. Creating and nurturing a positive workplace environment is essential to getting the best out of lawyers, improving client relationships and opening up the business to new opportunities.

Many law firms sadly remain stuck in the past and still adopt old-fashioned practices that could create a toxic working environment. If you’re a lawyer really looking to advance in your career and are employed in this type of company, you may feel that maintaining the status quo is not going to give you the opportunities to reach your goals.

The question is, how do you avoid finding yourself in a new company that has exactly the same practices and environment than the one you left behind? Here are the qualities and factors we think you should look for if you want to work in a positive law firm culture.


blurry chess board with king in focus to signify leadership

A positive law firm culture depends on effective leadership at all levels, both at the team level, department, division and the whole firm. This involves dedicating quality time to set out clear goals for the business and the individuals within it, while motivating Partners and employees alike to embrace and achieve these objectives.

For a company to succeed, it must have a clear direction and everybody should be pulling in the same direction. If the law firm’s culture consists of several departments trying to compete and outdo each other for bragging rights, then the business is likely to struggle to meet its objectives.

An effective leader will also put the company’s needs before their own and avoid the temptation of placing themselves above their subordinates. It takes more than one person to make a law firm successful, so a leader must act selflessly to ensure that everything is working as it should.


representation of two people communicating

Closely related to the topic of leadership is the issue of communication. A positive law firm culture will encourage regular distribution of praise and feedback so that lawyers understand exactly what is expected of them and are motivated by the fact that their hard work and dedication is not going unnoticed.

If several lawyers are required to collaborate on a specific project, a successful law firm will ensure that everybody involved will be kept up to date on progress – even after their contribution has ended. This instils a sense of togetherness and combined achievement which can have an extremely positive effect on morale.

While receiving market salary and a bonus is obviously welcome, a company wanting to adopt a positive law firm culture should also look at giving out small perks and thank-yous every once in a while. Gestures like these help lawyers feel more appreciated and helps them keep motivated.





cogs in a machine to signify teamwork

Successful law firms will embody a true sense of teamwork. This includes a willingness to share work and clients, to ensure that tasks are carried out as efficiently and expertly as possible.…

Should You Become A Partner At A Law Firm?

When you’re law career begins, you may find yourself working at a law firm as an associate and provided with a base salary. Transitioning from employee to becoming a partner at a firm is a great leap.

The path from associate to partner at a law firm may not always be clearly defined. However, there are a few criteria that can assist you if you’re being considered or have been offered to become a partner at a law firm.

The Path to a Partner at a Law Firm

Firms hiring lawyers often choose the best they can find. Applicants from top law schools are recruited first with interviews being limited to specific schools only.

There is a chance of distinguishing yourself in another way, however, most candidates for law firm positions will be considered by pre-selected schools.

Upon hire, your career often starts as an associate. You will be working with a mentor to learn how to practice law. At this time, you will be paid a relatively high salary as the law firm is investing in you at their firm.

While law firms seek to find the best potential lawyers, not all make partner at their firm. Some may leave to start their own private practice or start a firm of their own after a few years with the firm. The path to becoming a partner can be long and take now take over ten years before it occurs.

Partner vs. Non-Partner

On becoming a partner at a law firm, you not only take on more responsibility but also receive an equity stake in the firm’s profits. This provides you access to draw profits to cover your bills and monthly expenses. At the end of the year, you’ll be able to take a larger share when profits are distributed.

This is the typical style of partnership, however, there is also the possibility of becoming a non-partner which does not give you an equity stake in the law firm. Law firms have been adopting varying styles of multi-tiered partnerships which provide increases in salaries (and responsibilities) instead of receiving a small percentage of the firm.

In some cases, law firms may have different types of partnerships available. For example, you can be able to become an executive or managing partner.

There are many factors that influence the structure of a law firm and how it establishes available partnerships. Depending on the size and growth of a firm, offering a non-partnership promotion may be more financially secure than offering equity stakes. Law firms can be an LLC or a corporation and their level of success can determine how much access to equity their rising associates may receive.

Cost of Making Partner

Becoming a partner may not come cheap. Law firms that offer a partnership with an equity stake will often ask for a “buy-in.” That amount varies for each firm, however, some of the top firm’s may require hundreds of thousands of dollars as a capital investment.

Law school is already an expensive investment and many lawyers take years to pay back their loans.…

16 Top Areas of Law

As a lawyer, you need to be an expert in your field in order to successfully navigate the complicated waters of the legal ocean.

So what’s the best route to take? If you’re an aspiring lawyer just starting on your journey, there are a lot of options.

You can rely on your interests, what is in-demand at the time, and what is most lucrative to point you in the right direction. Here are 16 fruitful, promising areas of law for you to consider.

1. Complex Litigation

This is an area of law that demands a lot of patience and incredible attention to detail. Complex litigation is one of the more lucrative specializations because they involve high-stakes, corporate lawsuits and a lot of motions filed in court. The cases can last a long time, so if you like working toward a significantly large payoff, this route may be for you.

2. Corporate Law

Corporate law also handles business affairs, but it is more concerned with day-to-day, typical practices. Things like contracts, compliance, and liability fall under this umbrella. Lawyers specializing in this practice area can help a business get off the ground with its initial paperwork, or help them navigate difficult situations like bankruptcy.

3. Tax Law

Tax law is complex and always evolving, so it is an exciting practice area to enter. Tax attorneys can help guide people through audits and other issues with the IRS, as well as with estate planning. This specialization is also very lucrative, with some lawyers making up to $190,00 annually.

4. Intellectual Property

In the age of the internet, intellectual property (IP) is more important than ever before. From trademarks, to copyrights, to patents, and beyond, lawyers who work in IP help people protect their ideas and projects from duplication or theft.

5. Blockchain

Last year brought blockchain and bitcoin into the zeitgeist in a big way. As more people begin to understand these technologies, attorneys with knowledge of the topic will be increasingly valuable. If you can get in on the ground floor of this practice area, your opportunities are bound to grow.

6. Healthcare

It’s been a hot topic for quite some time, and healthcare laws in the US are still in flux. Therefore, professionals who are up to date on regulations and can navigate the landscape successfully will reap the benefits.

7. Environmental

Climate change is very much an issue that will increase in importance during our lifetimes. As we continue to figure out how to protect our environment effectively and regulations develop to reflect the necessary adjustments, lawyers in this practice area will be essential.

8. Criminal

Whether you want to be a defense lawyer or prosecutor, criminal law is full of opportunity. The lawyers in this practice area see a lot of courtroom drama while they protect the basic rights of their clients.

9. Civil Rights

Also dealing with basic human rights, civil rights attorneys do extremely important work. They sometimes work for nonprofits, but often work in other practice areas while taking these cases pro bono.


Should I Hire a Divorce Lawyer? | The World Financial Review

There is often a joke among lawyers that there are plenty of down on their luck lawyers who hang around churches in order to hand out their business cards to couples who are getting married. Although the joke is a bit over the top, it is indeed true that there are plenty of divorce lawyers who claim to specialize in that section of marriage law but do not really have the expertise that is often needed. Divorce requires special attention to the needs of each party, each of which will be unique. Having a lawyer that specializes in divorce will ensure that the lawyer is well versed in the divorce laws in your area and will have your best interests at heart.

Property Claims: Married vs. Common Law | Hamilton Lawyer | Family Law

Have you ever heard of a divorce case where the wife was demanding a ludicrous amount of alimony? She feels that she is entitled to this amount because in her mind it is fair. She does not consider how this amount might affect the livelihood of her ex-spouse, which is why an expert divorce lawyer is necessary to ensure the fairness to all parties. The financial needs of both parties need to be considered in order to ensure that no one is left destitute as a result of the divorce. In addition to alimony, there are cases where the fair settling of the estate needs to be handled, which is best done by an expert divorce lawyer.

Another major consideration when it comes to divorce is child support. In these situations, feelings can get hurt and discussions can get rather heated as parents disagree on what the child needs and what tends to be more of what a parent wants for their child. The child support needs to be in line with the financial means of the paying spouse, not putting him/her in financial distress as a result.

At the end of the day, the task of the divorce lawyer is to look after the best interests of his client and when a person hires a lawyer of immense experience then it is almost a given that he would not be ripped off by the opposing counsel. It is well worth your effort to find the best divorce lawyer possible to ensure the fairness of the settlements and agreements among all parties. Whether you are involved in an amicable divorce or a nasty divorce – the lawyer is the key component to the end result.

Contact us for more information.…

Top 10 Questions to Ask Before Hiring a Divorce Attorney

Should You Hire a Divorce Attorney? | HuffPost

When you’re going through a divorce and looking for an attorney, remember that you don’t have to hire the first attorney you meet. Choosing the right lawyer to guide you through your divorce is one of the most important divorce-related decisions you’ll make.

Even if you’ve received a referral to a family law attorney from a friend or another lawyer, you should still do your homework; check the attorney’s qualifications, and make sure he or she has enough experience to handle your case.

There are lots of lawyers out there, and many advertise themselves as “family law” or “divorce” attorneys. However, family law is a subspecialty that involves complex legal principles, which take time and experience to master. Within the area of family law, there are even further subspecialties, such as custody lawinternational custody law, guardianship, and an area of the law involving Qualified Domestic Relations Orders (QDROs), which are special orders required to divide certain types of retirement benefits.

In addition, there are various financial aspects of divorce, including:

  • financial disclosure requirements between spouses
  • restraining orders prohibiting spouses from changing beneficiary designations or transferring assets before and during the divorce
  • alimony (how to calculate income available for alimony and the special factors courts consider when determining setting payments)
  • child support (how to calculate child support in your state)
  • the division of property and assets, including real property, collectibles, venture capital interests, stock option portfolios, good will, or other business interests, and
  • the division of retirement benefits.

There is a vast body of law (which will vary from state to state) that applies to these issues. These laws are frequently updated or overturned by the legislature and/or the courts, so you’ll need to find an attorney that’s familiar with the new rules and cases that apply to your divorce.

If you have a very simple case, with minimal financial issues and no children, you may feel comfortable hiring a less experienced family law attorney. However, if you’re facing a contested divorce case that involves substantial assets, complicated financial questions, or a complex custody dispute, you should look for an experienced attorney that specializes in family law and has experience with the particular issues involved in your case. For tips about hiring a divorce lawyer to handle some or all of your divorce case, see our article, Hiring a Divorce Lawyer.

Ten Questions to Ask a Divorce Attorney

12 Questions to Ask a Divorce Attorney | Carosella

We’ve provided a few questions you might consider asking during your initial interview with a family law attorney. These may help you determine whether this lawyer is right for your case.

1. Do you specialize in divorces, or are divorces just a part of your practice? How long have you been practicing family law? How many family law cases have you handled? Are you a “certified family law specialist?”

2. What is your strategy for my case? How long will it take to resolve my case?

3. How long do you take to return phone calls?…


You’ve finished your law degree. You’ve breezed through practical legal training. You’ve signed the roll of solicitors. At last, the day you’ve worked years for has come – you’re a lawyer. So, what next? How do you translate all those years of hard learned law into a successful legal career? It’s a question commonly asked by students at the College of Law. In response, the College of Law has written an eBook guide to thriving as a lawyer, featuring 10 practical tips for new lawyers.



The ebook covers some of these topics and more. Download your copy for the full ebook.


Find a mentor, and don’t be afraid to ask questions

No lawyer starts their career knowing all the answers. The key is to ask good questions which reflect the fact that you have attempted to research and find the answer for yourself. A mentor can be an ideal person to whom you could pose career or legal questions; as mentor relationships can exist independently of your workplace, it can be a safe space to ask what might seem like foolish questions. Mentors are also an excellent source of contacts, and more importantly, only agreed to be your mentor because they are passionate about your progress. Formal mentoring programs can exist within a law firm, or as part of your local legal professional body. However, you can also form your own mentor relationships – if you meet someone you find inspiring, approach them! The worst that can happen is that they are too busy to assist.


Forget work-life balance, but be kind to yourself

Lawyer hours are notoriously long. So long, in fact, that perhaps it’s best to embrace the idea that work and life are not mutually exclusive. Indeed, they exist as part of a whole life – your whole life. Achieving balance is less about an unsustainable ‘work hard, play hard’ lifestyle, and more about enjoying what you do while also dedicating quality time to your loved ones, and looking after yourself through rest, exercise, and downtime.

It’s an approach that is fundamentally being kind to yourself. As a new lawyer, you’re likely to make mistakes. However, as well-trained pessimists, lawyers are often far too hard on themselves for making mistakes. Instead, reframe your mistake as a necessary lesson, one learned by countless lawyers before you. As long as you learn and consistently improve, it was a mistake well worth making.


Negotiate like a pro

Negotiating on behalf of your client is part of every lawyer’s day-to-day workload. Doing so effectively requires you to develop emotional intelligence and empathy, two skills not easily taught. To succeed as a negotiator, keep in mind that it is crucial to be ‘hard on the problem’, but ‘soft on the people’. In other words, be firm about your client’s position without making it personal for the person sitting across the negotiating table. Be courteous and collaborative as a negotiator; after all, settling a situation in the negotiation room is likely to be a lot more amicable and less expensive for your client than taking a case to court.…