WHAT YOU NEED TO KNOW ABOUT A LEGAL AUDIT
The more you know about your company, your competition and your customers, the faster you can adapt to marketplace changes and capitalize on opportunities. If you aren't regularly looking at the key operational areas of your business from a legal perspective, you're exposing yourself to unnecessary legal risks. Or missing major threats to your financial security. Or leaving major assets you didn't know you had on the table.
So what's the difference between you and other entrepreneurs? You're thinking about getting a legal audit, which is an incredible source of knowledge. A legal audit helps expose hidden risks and unmasks hidden assets or revenue sources in your business. A legal audit helps you understand the reality of your legal position. Once you have that knowledge, you can take appropriate action. Plus, avoiding a legal audit before you sell your business can have disastrous consequences on your sale during the due diligence period.
How can the Business Law Group help me with a legal audit?
Because we've handled a wide range of different corporate legal matters, we've observed up close what kinds of issues lead to expensive litigation situations when you don't handle them properly on the front end. Our legal audit services can help keep you from being surprised by legal issues down the road and limit your exposure to a variety of different legal risks.
Our firm has years of experience handling complex business matters. And as entrepreneurs ourselves, we know the most common triggers of commercial litigation, how to identify them early on, and how to mitigate potential risks. Our extensive knowledge of business best practices, as well as state and federal corporate law, lets us make actionable recommendations that help you avoid potential future legal problems.
Identify compliance issues early
For most companies, the biggest benefit of a legal audit is discovering compliance issues before regulators discover them or before they're exposed by expensive litigation. Once we perform a legal audit and identify compliance issues, we can address them so your company avoids future penalties.
Occasionally, we discover significant malfeasance or dishonest practices upper management didn't know about. If this is happening at your company, a legal audit can end these practices and guide us in creating new procedures so you're protected going forward.
An audit may also identify other actions or issues that put your company at risk for litigation. The most common example of this is around human resources. For example, if you don't deal with employee issues related to discrimination or harassment promptly and appropriately, you could end up costing your company millions of dollars. But, if we uncover these issues as part of a legal audit, your company has an opportunity to make amends to any harmed employees privately.
Discover additional value
The good news is that audits aren't only about risk mitigation. A legal audit can have a very positive impact on the revenue side of your business. When we focus on contract reviews, procurement policies or intellectual property, we often discover potential revenue streams or assets that the company didn't know existed.
For example, your company may have been giving away valuable intellectual property as a matter of routine instead of seeking to license the intellectual property to customers. You may also have missed some cases of copyright, trademark or patent infringement that are clearly actionable.
When we do a legal audit on your business, we might also uncover settlements from class actions against utilities or carriers that you've unknowingly failed to collect.
What should be audited in my business and how often?
While every business is different, here are the areas that benefit the most from legal audits:
- Government contract compliance
- Human resources
- Intellectual property
- Corporate structure.
While all legal audits follow the same general process, audits on different areas will often have different goals. For example, a government contract compliance audit and a human resources audit will be heavily focused on risk mitigation. A securities audit or a litigation audit could focus on making sure your company has due diligence procedures in place, and also developing processes to make sure your existing legal processes are as efficient as possible.
Depending on your company size and industry, you may also want to conduct regular legal audits of your antitrust compliance, IT and software security and compliance, and environmental compliance.
We recommend that most companies schedule a legal audit in one or more major areas of their business every three to five years. However, if you've recently encountered a major issue that led to litigation or some type of regulatory action, you might need a legal audit to make sure there are no other potential landmines hidden in your files or processes.
What happens after a legal audit?
The real value of a legal audit for your business is less what we discover, and more in what your company does with the audit results. As part of the audit, your Business Legal Group team will present a list of findings and recommendations.
Of course, it'll be up to your company's board and management team on how you'd like to handle our recommendations. Many of our clients call us back to perform followup work related to how they implement our recommendations.
Once we've completed your audit, you should schedule your company's next audit as part of your post-legal audit workflow. This helps establish a regular pattern of audits that make sure your company takes full advantage of your assets and does everything feasible to mitigate any risks.
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SCHEDULE YOUR CONSULTATION WITH BUSINESS LAW GROUP TODAY
Whether you're a startup or established company, our Business Law Group attorney team can perform a thorough legal audit of your current business situation and make recommendations for what processes to revise. Plus, we might even find hidden assets you didn't even know you had. Schedule your consultation with us today so we can schedule your legal audit.