Jacqui Johnson, a Law Society Lexcel Consultant and Assessor, looks at efficient ways to undertake file audits out of the office. She has been in private practice for over 15 years as a practice manager.
During the current pandemic and in accordance with Government guidelines, law firms have had to furlough fee earners and support staff, allow many staff to work from home and operate with key skeletal personnel in offices where necessary and appropriate. Under these unprecedented circumstances, how are firms conducting file audits remotely? Given the circumstances, are they still necessary or should they be abandoned altogether?
The short and simple answer is yes, file audits are necessary and here are some reasons why:
- File audits continue to be a requirement of Lexcel, CQS, WIQS and LAA quality requirements.
- Face to face supervision, team meetings and file reviews may be taking place less frequently
- Supervisors may have been placed on furlough and/or changed.
- Firms are required by the SRA to manage risk and to keep full records of how they have dealt with risk (Code for Firms 2.2 and 2.5).
- Evidence of effective file audits and supporting records may assist should a PI claim arise on any file that was dealt with whilst many staff are working from home.
There are additional challenges to conducting file audits remotely to those undertaken in the office.
Some top tips for preparing for and conducting file audits whilst working from home:
1. Consider your current working practices and how can they be adapted if necessary
Ask yourself the following important questions, as they will help you figure out where to start:
- Do you have electronic files or paper files?
- Can you access case management systems remotely?
- Do your electronic files contain correspondence/documents in as well as out?
- If you do not operate a CMS, will you need to scan documents, file share or find alternative means of file data sharing? Can you safely share and access data whilst working from home?
2. Review your file review checklist
Having a checklist is an good way to ensure that audits are conducted properly.
- Is it up to date or does it need adapting due to the changes in working practices?
- Does it provide for alternative means of AML ID checks and effective recording of how these took place?
- Does your risk assessment documentation need to be adjusted to reflect working from home and in some cases, limited resources?
- Will your risk levels require changing/adaption?
3. For furloughed fee earners
Run a client matter list and check that all current active files have been re-allocated to staff actively working from home or in the office.
4. Check for file inactivity
Run regular reports from any case management system on files that have been inactive (for say 30 days) to ensure they have been captured in the re-allocation process.
5. Audit selections
Concentrate this on files opened and/or active during the lockdown and furlough period to ensure all processes have been carried out (especially where resources are at a minimum or absent).
6. Review files from active fee earners only
Furloughed staff files will have to be re-allocated to active fee earners.
7. Consider reducing the number of files reviewed
Where there are fewer supervisors to conduct audits consider reducing the number of files reviewed but remember to keep within the guidelines of accreditations requirements.
8. Document everything
Keep track of how your amended/reviewed file audit policies were conducted whilst working from home or on furlough; for example, are fewer files being selected to audit and when will the revised policy be reviewed again?
Once your files have been selected for audit:
1. Check your core documents and procedures are taking place
With restricted and absent resources, it is easy to cut corners so do ask the following:
- Has your risk assessment and client due diligence been conducted and have these been checked and authorised where required?
- Are conflict of interest checks being carried out as usual?
- Check client care letters and terms of business are being sent out. Have these been adjusted to notify clients that there may be possible delays in your response or if there has been a change of supervisor?
- Has the risk level changed due to working from home or the restrictions and staffing levels of other organisations?
- When conducting regulated work, have your AML procedures been modified? Check documentation is being captured in accordance with your revised policy and recorded appropriately.
2. Record your key dates in a central diary
This is particularly important when staff may be taken unexpectedly ill and files may be re-allocated at short notice.
3. Are costs updates being monitored, recorded and notified to clients in an appropriate timeframe?
Make sure that these records are kept and distributed properly.
4. Inform them of staff changes
Where staff have been furloughed have clients been informed of a change of fee earner/supervisor who will be dealing with their matter? Clear communication will help streamline the overall process.
File audits may appear to add additional burdens to staff working from home, but are nonetheless an essential part of day to day risk management and good practice, and a task that can be easily achieved with some minor adaptions. This has been evidenced by the fact that to date, 162 remote audits have successfully taken place for the Law Society’s Lexcel accreditation.