6.Professional Services

Question 1

Role of third-party professionals: Audit

Answer 1

• Reviewing the financial accounts of an organisation to ensure that they are valid and that they have been prepared in line with accounting regulation and frameworks

Question 2

Role of third-party professionals: Tax

Answer 2

• Advising businesses on how to complete tax returns and specialising in ensuring they are adhering to legislation and regulation

Question 3

Role of third-party professionals: Actuatial

Answer 3

• Calculating and assessing future financial risks and making predictions using models and statistics

Question 4

Role of third-party professionals: Insurance

Answer 4

• Claims analysts who advise on insurance claims; risk management specialists who advise businesses on their approach to the identification and management
  of business risks

Question 5

Role of third-party professionals: Lenders

Answer 5

• Engaged in the marketing of loans such as mortgages, gathering information on loan applications from individuals and
  businesses, underwriting loans or funding loans

Question 6

Role of third-party professionals: Corporate finance

Answer 6

• Dealing with sources of funding, the capital
  structure of corporations, examining the actions that managers take to ensure profitability and maximum value to shareholders

Question 7

What are the risks associated with engaging third parties

Answer 7

• Ethical behaviour,
  relevant experience,
  disclosure of sensitive information,
  costs,
  profitability,
  privacy,
  compliance,
  reputational and strategic risks.

Question 8

What is Professional Indemnity Insurance?

Answer 8

It helps protect you if a client says your work caused them financial loss — for example, through a mistake, bad advice, or negligence. It covers legal costs and any compensation you might need to pay.

Question 9

Why do ppl purchase Professional Indemnity Insurance

Answer 9

To cover legal costs if a client takes legal action against them

To pay compensation if their mistake causes a client financial loss

To protect their reputation and show clients they take responsibility seriously

Question 10

What are the limitations of Professional Indemnity Insurance?

Answer 10

It doesn’t cover intentional wrongdoing – like fraud or criminal acts.

It only covers claims made while the policy is active – if you cancel it, you’re not protected.

There’s a payout limit – the insurer won’t pay more than the agreed amount.

Question 11

What is the important of Service Level Agreements (SLA)

Answer 11

• Contractual obligations
• Working within the scope of engagement
• Clear standards of service/delivery requirements
• Customer service
• Internal SLAs in the provision of accounting services provided to departments and the management team (internal stakeholders) within the same organisation.

Question 12

Professional code of conduct and its impact

Answer 12

Builds a good reputation​

Increases the attractiveness of your business​

Attracts outstanding employees​

Helps disclose and manage conflicts of interest​

Creates standard best practices for internal and external behaviour​

Improves compliance​

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