Franchise Financial Reporting and FDD Compliance
Franchise Audit Requirements: How Franchisors Should Screen and Select an Auditor
An initial or annual franchise audit is not merely a year-end accounting project. The auditor’s work becomes part of the Franchise Disclosure Document, may be reviewed by state franchise examiners, and can directly affect when a franchisor is permitted to offer and sell franchises.
Practical takeaway: Before retaining a CPA firm for a franchise audit, confirm that the firm is properly licensed, has relevant audit experience, understands the franchise disclosure process, maintains appropriate quality controls, and is compliant with applicable peer review requirements.
Whether a business is preparing to franchise for the first time or updating an established franchise system, the audit often becomes one of the most important parts of the disclosure calendar. A delayed audit can delay the annual Franchise Disclosure Document update. A deficient audit can generate regulatory comments, require revised financial statements, complicate state renewals, or force the franchisor and its legal team to repeat work that should have been completed correctly the first time.
The problem is not always that an accountant lacks general tax or bookkeeping experience. The problem may be that the accountant does not routinely perform financial statement audits, does not understand the reporting standards applicable to the engagement, has not developed adequate audit documentation, or is unfamiliar with how audited financial statements are used in an FDD and reviewed by franchise regulators.
Franchisors should therefore evaluate an auditor differently from the way they might select a tax preparer, outsourced bookkeeper, or general business accountant. Price matters, but the lowest proposal can become the most expensive option if the work must later be corrected, supplemented, or repeated.
Initial Franchise Audit
A new franchisor may need opening balance sheet information and phased-in audited financial statements, depending on its history, structure, applicable law, and the states in which it intends to register.
Annual Franchise Audit
Existing franchisors generally need updated audited financial statements for the annual FDD update and related state franchise renewal filings.
Regulatory Review
In registration states, franchise examiners may review the audit report, financial statement notes, equity, liquidity, related-party activity, and consistency with the rest of the FDD.
Why Franchisors Need Audited Financial Statements
Item 21 of the Franchise Disclosure Document addresses the franchisor’s financial statements. Subject to limited exceptions and permitted phase-in rules for qualifying new franchisors, the FDD generally includes financial statements prepared in accordance with applicable accounting standards and audited by an independent certified public accountant.
These statements commonly include balance sheets, statements of operations or income, statements of cash flows, statements of owners’ equity or members’ equity, related notes, and the independent auditor’s report. The precise presentation will depend on the franchisor’s entity structure, history, accounting framework, and applicable requirements.
The financial statements serve several purposes. They provide prospective franchisees with information concerning the franchisor’s financial condition, give regulators a basis to evaluate whether the franchisor appears able to perform its obligations, and support other disclosures throughout the FDD.
The Audit Must Align With the Entire FDD
The audit cannot be prepared in isolation. Revenue descriptions, related-party transactions, affiliate relationships, ownership interests, franchise fee recognition, deferred revenue, litigation contingencies, advertising funds, company-owned operations, and other financial information may overlap with Items 1, 2, 3, 6, 8, 11, 19, and 20 of the FDD.
An audit may be technically complete from an accounting perspective but still create franchise disclosure problems if the legal and financial disclosures are inconsistent. For example, the financial statements may identify an affiliate, payable, revenue category, related-party arrangement, or material obligation that is not adequately addressed elsewhere in the FDD.
This is one reason the auditor, franchisor, bookkeeper, and franchise attorney should coordinate early in the process rather than waiting until the audit is nearly complete.
State Franchise Examiners Are Paying Attention to Audit Quality
Franchisors should not assume that regulators will accept an audit merely because a CPA signed the report. State franchise examiners may evaluate whether the financial statements comply with applicable requirements, whether the auditor appears properly qualified, whether the statements are internally consistent, and whether the audit report and notes raise concerns about the franchisor’s financial condition.
In our experience, state regulators are increasingly willing to ask questions about the auditor, the audit opinion, the underlying accounting treatment, and the firm’s peer review status. This is particularly important when a regulator identifies unusual formatting, incomplete notes, inconsistent balances, questionable independence, a modified opinion, a going-concern disclosure, or other indications that the audit may not satisfy the state’s requirements.
Regulators may also impose financial assurance requirements when a franchisor’s financial condition raises concerns. Depending on the state and circumstances, those requirements may include a fee deferral, escrow arrangement, surety bond, capitalization requirement, or another condition intended to protect prospective franchisees.
Maryland regulations, for example, expressly permit denial of a franchise registration or renewal application when the franchisor does not submit audited financial statements that comply with the state’s requirements. Franchise registration materials also commonly require the franchisor to submit an accountant’s consent authorizing the use of the audit report in the FDD and registration filing.
A Signature Is Not a Substitute for Adequate Audit Procedures
Some accounting firms offer franchise audits without maintaining the diligence procedures, documentation practices, quality controls, or franchise-specific familiarity needed for the engagement. A franchisor should investigate those issues before retaining the firm, not after a state examiner questions the audit.
Understanding the AICPA Peer Review Process
The American Institute of Certified Public Accountants maintains a peer review program intended to promote quality in accounting and auditing practices. In general terms, peer review is an external evaluation of a CPA firm’s accounting and auditing practice and its system of quality management or quality control.
The review is not a government certification that every audit performed by the firm is correct. It also does not guarantee that a particular franchise audit will satisfy every legal, regulatory, or accounting requirement. It is, however, an important quality-control indicator and a basic due diligence step for any franchisor considering a CPA firm for an audit engagement.
AICPA member firms that perform covered accounting and auditing engagements are generally required to participate in the peer review program. State licensing rules may also impose peer review requirements. The precise requirement can depend on the firm, its membership status, the services it performs, and the jurisdiction in which it practices.
What a Peer Review May Evaluate
Depending on the type of review and the nature of the accounting firm’s practice, the peer review process may evaluate the design of the firm’s quality-control system, whether the firm complied with that system, and whether selected engagements were performed and reported in conformity with applicable professional standards.
The reviewer may examine engagement documentation, reports, professional development, independence procedures, client acceptance and continuance practices, supervision, consultation procedures, and other aspects of the firm’s accounting and auditing practice.
Peer review findings may lead to required corrective actions, additional education, monitoring, engagement reviews, or other remediation. More serious or recurring issues can create significant concerns for a prospective audit client.
How to Check an Auditor’s AICPA Peer Review Record
The AICPA maintains a public search tool that allows users to search for accounting firms and review available peer review information. Franchisors should conduct this search before signing the engagement letter and should save a copy of the results in their compliance records.
Important Website Warning
The AICPA public-file page may appear in some browsers as an older or “not secure” webpage. Despite that warning, the public-file search is the AICPA resource used to locate available peer review enrollment information and public peer review documents. Do not enter sensitive financial information into the search page. You should only need the accounting firm’s identifying information.
Access the AICPA Peer Review Public File Search here: AICPA Peer Review Public File Search.
Confirm the Auditor’s Exact Legal Firm Name
Ask for the complete name of the CPA firm that will issue the audit opinion. Do not rely solely on a trade name, individual accountant’s name, or marketing brand. The entity issuing the report should match the firm identified in the engagement letter and peer review record.
Search the AICPA Public File
Search by firm name and, where available, location or other identifying information. Accounting firms may have similar names, affiliated practices, predecessor entities, or multiple offices, so confirm that you are reviewing the correct firm.
Check Enrollment and Review Dates
Determine whether the firm is identified as enrolled, the date of its most recent peer review, and whether the timing appears current. Ask the firm to explain any missing, expired, inconsistent, or unclear information.
Open Available Public Documents
Not every firm’s full peer review report will necessarily be publicly displayed. When reports, acceptance letters, corrective-action documents, or related materials are available, review them carefully rather than stopping at the search-result summary.
Request Documents Directly From the Auditor
Ask the firm to provide its most recent peer review report, acceptance letter, and any documents reflecting corrective actions or completion of remediation. A qualified auditor should be prepared to discuss its quality-control history professionally and directly.
Document the Franchisor’s Review
Save the public-file results, documents provided by the auditor, relevant correspondence, and the date of review. Repeat the check before each new engagement or annual renewal, especially if the accounting firm has changed names, ownership, offices, or engagement personnel.
The AICPA public file generally displays basic identifying information, enrollment status, and the date of the last peer review for firms enrolled in the program. Additional documents may be available for firms participating in specified AICPA practice sections or quality centers or for firms that voluntarily make their results public.
How to Interpret Peer Review Results
Peer review terminology can be confusing to someone who does not work in public accounting. The exact report language and applicable standards should be reviewed carefully, particularly because the AICPA has updated and clarified its peer review standards over time.
At a practical level, a franchisor should determine whether the firm’s system and selected engagements received an acceptable result, whether deficiencies or significant deficiencies were identified, and whether corrective actions were required. The franchisor should also consider whether the reviewed practice included audit engagements comparable to the work the firm will perform for the franchisor.
| Peer Review Information | What It May Indicate | Recommended Follow-Up |
|---|---|---|
| Current enrollment and timely review | The firm appears to be participating in the applicable peer review process. | Request the report and acceptance letter, then confirm the reviewed practice included relevant audit work. |
| Pass or acceptable result | The review did not identify issues requiring a modified peer review rating under the applicable standards. | Continue diligence. A favorable peer review is not a guarantee that the firm has franchise experience or that the proposed engagement team is appropriate. |
| Deficiencies or corrective actions | The reviewer identified issues that may require remediation, education, monitoring, or follow-up. | Obtain all related documents and a written explanation. Determine whether the issues involved audit engagements or areas relevant to the proposed franchise audit. |
| Adverse, failed, or seriously modified result | The firm may have significant quality-control or engagement-performance issues. | Proceed with substantial caution. Consult franchise counsel and an independent accounting professional before retaining the firm. |
| No record or unclear status | The search may involve the wrong legal name, an affiliate, a new firm, a firm not enrolled, or another issue requiring explanation. | Do not assume the absence of a result is harmless. Request proof of licensure, peer review status, and the exact entity that will issue the report. |
| Late or outdated review information | The firm’s review may be pending, overdue, incomplete, or associated with a predecessor entity. | Request documentation from the administering entity or state accountancy authority and confirm current eligibility to perform the engagement. |
| Termination or withdrawal from the program | The firm may have ceased performing covered work, failed to comply with program requirements, reorganized, or encountered a disciplinary issue. | Obtain a complete explanation and supporting documents. Do not retain the firm until the issue is satisfactorily resolved. |
When a firm receives an unfavorable result, the peer review report, acceptance information, remediation documents, termination information, or related red flags may be publicly available. Public availability varies, so the absence of a posted report should not be treated as proof that no issues exist.
A franchisor should ask direct questions, obtain the documents, and evaluate the response. Evasiveness about peer review history can be as concerning as the underlying result.
Red Flags When Screening a Franchise Auditor
No single fact automatically disqualifies an accounting firm. The following warning signs, however, justify additional diligence and may indicate that the firm is not the right choice for a franchise audit.
Cannot Explain Peer Review Status
The firm cannot identify its administering entity, provide its latest peer review documents, or explain why its public record is missing or outdated.
Uses the Wrong Firm Name
The engagement letter, peer review record, state license, and proposed audit report identify different accounting entities without a clear explanation.
No Meaningful Audit Practice
The firm primarily prepares tax returns or provides bookkeeping services but performs few financial statement audits and cannot demonstrate established audit procedures.
No Franchise Experience
The auditor has never prepared financial statements for inclusion in an FDD and does not understand Item 21, phased-in financials, state registration deadlines, or accountant consent requirements.
Promises an Unrealistic Turnaround
The firm quotes a very short timeline before reviewing the records, evaluating internal controls, identifying related parties, or understanding the franchisor’s entity structure.
Minimal Document Requests
The auditor requests little more than a trial balance and bank statements and does not seek contracts, invoices, debt records, ownership information, related-party details, legal correspondence, or supporting schedules.
No Independence Discussion
The firm provides bookkeeping, management, valuation, consulting, or other services but does not evaluate whether those relationships affect auditor independence.
Refuses to Coordinate With Counsel
The firm is unwilling to discuss FDD deadlines, legal contingencies, related-party disclosures, franchise fee accounting, or inconsistencies identified during the disclosure process.
Unclear Engagement Team
The partner selling the engagement will not supervise the work, the staff lacks audit experience, or the firm cannot identify who will perform and review the fieldwork.
Fee Is Dramatically Below the Market
A low fee may reflect efficiency, but it may also suggest inadequate staffing, limited testing, templated work, or an incomplete understanding of the engagement.
History of Reissued Reports
The firm frequently revises completed statements, corrects basic errors after delivery, or has difficulty producing final statements that reconcile to the franchisor’s books.
Dismisses Regulatory Concerns
The auditor suggests that state examiners never review financial statements or that any signed CPA report will automatically be accepted.
Questions to Ask Before Retaining a Franchise Auditor
Franchisors should interview the proposed auditor and obtain clear answers before signing the engagement letter. The following questions can help distinguish a qualified franchise auditor from a firm that merely offers a low-cost audit product.
The Initial Franchise Audit Process
A business preparing its first FDD should involve the auditor early. Waiting until the legal documents are substantially complete may create avoidable delays, particularly if the franchisor’s books require cleanup, the entity structure is still changing, or the operating company and franchisor have overlapping transactions.
1. Confirm the Franchisor Entity
The audit must cover the correct legal entity. The franchisor is generally the entity that will offer and sell franchises, enter into franchise agreements, collect franchise fees and royalties, and undertake the contractual obligations disclosed in the FDD.
Using an operating company’s financial statements simply because it has a longer history may not be appropriate unless the organizational structure and applicable disclosure requirements support that approach. Parent-company or consolidated financial statements require careful legal and accounting analysis and may create additional disclosure or guaranty issues.
2. Determine Whether Phase-In Treatment Is Available
Certain new franchisors may qualify to phase in audited financial statements. The permitted treatment depends on the franchisor’s history, the applicable federal disclosure requirements, and the laws and policies of the states in which the franchisor intends to register or sell.
Phase-in treatment should not be assumed. A state may require more financial information, reviewed statements, audited opening balances, an accountant’s report, or other support. The franchisor’s legal and accounting teams should evaluate the planned sales states before determining the required scope.
3. Clean Up the Accounting Records
New franchisors frequently begin the audit with incomplete records, mixed personal and business expenses, affiliate transactions, uncategorized payments, inconsistent owner contributions, or inadequate documentation. These conditions increase the auditor’s work and may delay the FDD.
Before fieldwork begins, the franchisor should reconcile its bank and credit-card accounts, document equity contributions and loans, identify related parties, organize contracts and invoices, confirm ownership, and prepare schedules supporting material balances.
4. Coordinate the Audit and FDD Timelines
The audit often controls the FDD issuance date. Franchisors should establish a written timeline identifying the bookkeeping cutoff, document-delivery date, fieldwork period, draft financial statement date, legal review period, final report date, and state filing deadlines.
Learn more about the broader development process in our guide to the legal requirements for franchising a business.
The Annual Franchise Audit Process
Established franchisors should treat the annual audit as a recurring compliance project, not an unexpected year-end emergency. For a calendar-year franchisor, the annual FDD update is generally completed within 120 days after fiscal year-end, subject to applicable federal and state requirements. That timeline leaves little room for delayed bookkeeping or an auditor who begins planning late.
| Timing | Recommended Action |
|---|---|
| Before fiscal year-end | Confirm the auditor, engagement scope, peer review status, staffing, timetable, and document-request list. |
| Immediately after year-end | Close the books, reconcile accounts, finalize schedules, and provide requested records. |
| During fieldwork | Respond promptly to audit questions and keep franchise counsel informed of material findings. |
| Draft statement stage | Compare the financial statements and notes to the draft FDD, ownership records, related-party disclosures, litigation information, and Item 20 data. |
| Before issuance | Resolve inconsistencies, confirm the final auditor’s report, and obtain required accountant consent letters. |
| After issuance | Complete the annual FDD update, state renewals, financial assurance responses, and sales compliance rollout. |
The annual update involves more than replacing last year’s audit. Franchisors should also update outlet information, franchisee contacts, fees, estimated initial investment figures, litigation, bankruptcy disclosures, agreements, financial performance representations, and other material information.
Our Franchise Compliance Guide for Franchisors explains why annual FDD updating should be part of a broader year-round compliance system.
Documents a Franchise Auditor May Request
The exact request list will vary, but franchisors should expect a meaningful audit process to require substantial documentation. A request limited to financial statements, tax returns, and bank statements may not be sufficient for an entity with material operations or complex transactions.
- Year-end trial balance and general ledger.
- Bank statements, reconciliations, and bank confirmations.
- Accounts receivable and accounts payable detail.
- Debt agreements, promissory notes, and lender statements.
- Equity contributions, distributions, and ownership records.
- Franchise agreements and schedules of initial franchise fees.
- Royalty reports and revenue-supporting documentation.
- Deferred revenue calculations and revenue-recognition schedules.
- Related-party and affiliate transaction schedules.
- Leases, vendor contracts, and material commitments.
- Payroll records and contractor information.
- Tax returns and correspondence with taxing authorities.
- Legal inquiry letters and information concerning pending or threatened claims.
- Board, member, or shareholder meeting records.
- Subsequent-event information arising after fiscal year-end.
- Advertising fund accounts and expenditures, where applicable.
- Company-owned outlet financial information.
- Prior-year financial statements and adjusting entries.
The fact that an auditor requests extensive records should not automatically be viewed as inefficiency. Appropriate diligence is part of the audit process. The more organized the franchisor’s records are, the more efficiently the auditor can complete the work.
Common Franchise Audit Issues
Franchise Fee Revenue Recognition
Initial franchise fees may not always be recognized as revenue immediately upon receipt. The appropriate accounting treatment depends on the franchisor’s obligations and applicable accounting standards. Franchisors should avoid assuming that cash received and revenue recognized are the same.
Related-Party Transactions
Franchisors frequently share ownership, personnel, intellectual property, office space, vendors, or expenses with an affiliated operating company. These relationships must be identified and properly documented. They may also require disclosure in the notes and elsewhere in the FDD.
Parent or Affiliate Financial Statements
A franchisor may ask whether it can use a parent company’s audit or consolidated financial statements. The answer depends on the structure and applicable requirements. Using parent financial statements may require additional disclosures, a guaranty of the franchisor’s obligations, or inclusion of guarantor financial statements and related documents.
Going-Concern Disclosures
If conditions raise substantial doubt about the franchisor’s ability to continue as a going concern, the audit report or financial statement notes may include related disclosures. Those disclosures can affect state review and may lead to financial assurance requirements.
Advertising Funds
Advertising funds may require separate tracking, appropriate accounting treatment, and disclosure concerning how contributions are administered. The auditor should understand how the franchisor collects, holds, and spends those amounts.
Legal Contingencies
Pending litigation, threatened claims, settlements, regulatory matters, and contractual disputes may affect the financial statements. Counsel and the auditor must communicate appropriately while preserving applicable privileges and complying with professional requirements.
Inconsistent Entity Activity
Problems arise when franchise fees are deposited into the wrong company, franchise expenses are paid by an affiliate without documentation, intellectual property is held outside the disclosed structure, or the franchisor’s records do not match the agreements presented to franchisees.
How Franchise Counsel Can Help With the Audit Process
Franchise counsel does not perform the audit and does not direct the auditor’s professional judgment. Counsel can, however, help coordinate the legal and regulatory aspects of the project.
That coordination may include confirming the correct franchisor entity, evaluating phased-in financial statement rules, identifying state deadlines, reviewing parent-company structures, coordinating accountant consent letters, comparing the audit to the FDD, responding to state examiner comments, and addressing financial assurance conditions.
Counsel can also help the franchisor identify disclosure issues raised by the financial statements. An affiliate listed in the notes may need to be described in Item 1. A legal contingency may affect Item 3. A supplier rebate or related-party payment may affect Item 8. A revenue stream may affect how the business model is described elsewhere in the FDD.
Franchisors preparing their first disclosure document can learn more about our franchise development and FDD process. Existing franchise systems may benefit from a broader franchise compliance review or a structured franchise sales compliance program.
Franchise Auditor Screening Checklist
Complete These Steps Before Signing the Engagement Letter
- Confirm the exact CPA firm that will issue the audit opinion.
- Verify the firm’s active license and good standing with the applicable state accountancy authority.
- Search the AICPA Peer Review Public File.
- Review the most recent peer review date and enrollment status.
- Obtain the peer review report and acceptance letter directly from the firm.
- Request all corrective-action or follow-up documents.
- Ask whether the reviewed practice included comparable financial statement audits.
- Confirm the engagement team’s franchise and audit experience.
- Evaluate independence and other services provided by the firm.
- Request a detailed document list and project schedule.
- Confirm responsibility for accountant consent letters.
- Require prompt coordination with franchise counsel.
- Review exclusions, additional fees, and delay provisions in the engagement letter.
- Confirm that the final delivery date supports the annual FDD and state renewal deadlines.
This process should be repeated periodically. Peer review status, personnel, ownership, licensure, quality controls, and the firm’s audit practice can change. A favorable review from several years ago should not replace current diligence.
Preparing for an Initial or Annual Franchise Audit?
Waldrop & Colvin helps new and established franchisors coordinate audited financial statements with FDD preparation, annual updates, state registrations, renewals, financial assurance requirements, and ongoing franchise compliance.
Schedule a Consultation Review Our Franchise Compliance GuideFrequently Asked Questions About Franchise Audits
Does a new franchisor need an audit?
A new franchisor generally must include financial statements meeting the requirements of Item 21. Some qualifying new franchisors may be permitted to phase in audited financial statements, but the available treatment depends on the franchisor’s history and applicable state requirements. The issue should be evaluated before preparing or filing the FDD.
How often does a franchisor need an audit?
Most established franchisors obtain an audit annually so that updated audited financial statements can be included in the annual FDD update. Additional audited or interim financial information may be required in particular circumstances.
When should a franchisor hire its auditor?
A new franchisor should engage an auditor early in the franchise development process. An existing franchisor should generally confirm the annual engagement, project schedule, and document list before fiscal year-end.
Can the franchisor’s regular tax accountant perform the audit?
Possibly, but tax experience alone is not sufficient. The firm must be properly qualified and independent, maintain an appropriate audit practice, comply with applicable professional and peer review requirements, and have the ability to issue financial statements suitable for inclusion in the FDD.
What is an AICPA peer review?
Peer review is an external evaluation of a CPA firm’s accounting and auditing practice and quality-control system. It is intended to promote compliance with applicable professional standards and identify areas requiring improvement or remediation.
Where can a franchisor check an auditor’s peer review?
Franchisors can use the AICPA Peer Review Public File Search. Because the page may display a browser security warning, users should not enter confidential information. The search should require only basic information identifying the CPA firm.
Are all peer review reports public?
No. The public file may show enrollment status and the date of the last review even when the full report is not displayed. Additional documents may be public based on the firm’s AICPA participation or voluntary disclosure. The franchisor should request the full report and acceptance letter directly from the accounting firm.
What happens if an accounting firm fails peer review?
The consequences depend on the findings, applicable standards, administering entity, and licensing rules. The firm may be required to complete corrective actions, education, monitoring, or follow-up review. Serious or unresolved problems may affect the firm’s standing or ability to perform covered engagements. A prospective franchisor client should obtain and evaluate all related documentation before retaining the firm.
Can a state reject a franchise audit?
A state regulator may object to financial statements that do not satisfy applicable franchise requirements. Deficiencies can lead to examiner comments, delayed registration, requests for revised statements, denial of an application, or financial assurance conditions.
Can a franchisor use its parent company’s audited financial statements?
Sometimes, but the structure must be carefully evaluated. The use of parent or consolidated financial statements may require additional disclosure, a parent guaranty, guarantor financial statements, or other documents. The franchisor should coordinate with franchise counsel and the auditor before relying on parent financials.
How long does a franchise audit take?
The timeline depends on the quality of the franchisor’s books, business complexity, availability of supporting records, audit-firm capacity, and speed of management responses. A straightforward engagement with organized records may move efficiently, while incomplete or inconsistent records can add substantial time.
How much does a franchise audit cost?
Fees vary based on the franchisor’s size, transaction volume, entity structure, accounting quality, related-party activity, number of locations, and the scope of required testing. Franchisors should compare the scope, qualifications, staffing, and expected procedures rather than selecting an auditor based solely on price.
Final Takeaway
The auditor selected by a franchisor can affect far more than the financial statements. The audit can control the timing of the FDD, influence state registration review, affect financial assurance requirements, and reveal issues that must be addressed throughout the disclosure document.
Franchisors should approach the selection process with the same care they apply to selecting franchise counsel or building the franchise agreement. Confirm relevant experience, verify licensure, review independence, understand the proposed procedures, examine the engagement team, and always check applicable peer review compliance.
The AICPA Peer Review Public File is an important starting point, but it should not be the end of the inquiry. Obtain the actual documents, ask direct questions, investigate red flags, and make sure the auditor understands both financial statement auditing and the practical demands of the franchise disclosure process.
A careful screening process may take additional time at the beginning of the engagement, but it can help prevent far more expensive delays, corrections, and regulatory complications later.
