When assisting investigative counsel, how do you ensure seamless communication and coordination to achieve the right outcome for your client? Typically, we are retained by investigative counsel in these matters and therefore, the attorney-client privilege doctrine applies to our work (as we act as an agent of counsel). Counsel is often retained by the Audit Committee. We are also independent of the subject company. Maintaining privilege is a key objective throughout the process, and we have developed applicable protocols and practices to ensure the privilege is maintained and that an unintentional waiver does not occur. In addition, our professionals are trained on typical privilege issues so they can flag those for counsel if they arise in the field. I have been doing this work for over thirty years and I find that you can never communicate too much with counsel (and other stakeholders) as the process unfolds. We often establish (at least) daily team calls in the early stages of an investigation with the legal team. This helps ensure that there is clarity of purpose and roles, and clear communication around focus and priorities. As the matter progresses, teams of attorneys and forensic accountants are usually “paired up” and deployed to workstreams and the communication process may become more decentralized on a day-to-day basis. But a full team call is still beneficial on a regular basis. It is also important to have a senior team member focus primarily on ensuring that the overall process is moving expeditiously, and to manage “roadblocks” or challenges in real time. Oftentimes it is beneficial to have regular status updates with key stakeholders. It is key to ensure that the external auditor is briefed on the status of the investigation and is given ample opportunity to comment on the adequacy of scope. This is especially true if there are upcoming filing deadlines for financial reports that may be impacted by an ongoing investigation. There will sometimes be tension between the auditor’s information requests and the goal of maintaining privilege. In my experience, seasoned investigative counsel can navigate this issue successfully and ultimately the investigation will be completed, and the auditor will be able to opine on the financial statements within a reasonable timeframe. Can you outline the key steps you would take when initiating an accounting investigation based on whistleblower allegations? Counsel will often take the lead with document preservation and the suspension of routine destruction practices. Our initial role would be to review and understand the accounting and internal control allegations raised in detail and to develop a preliminary understanding of the universe of potential issues raised. If the whistleblower has come forward, we would seek to interview them as soon as practicable. During the investigation, counsel will take steps to provide overall context for employees to help reinforce the need for confidentiality and to maintain privilege. In interviews, counsel will provide specific instruction about not discussing interviews with others. Often, company management will be keen to determine the identity of the whistleblower. Sometimes this may be part of an effort to evaluate the whistleblower’s credibility. Counsel will need to ensure that all applicable whistleblower protection laws are observed. Once we have framed out our 30 LAWYER MONTHLY NOVEMBER 2023 It is key to ensure that the external auditor is briefed on the status of the investigation and is given ample opportunity to comment on the adequacy of scope.
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