Let’s assume you need to complete an AML/operational/IT audit. You received the first quote from the audit firm and you are about to have a panic attack or something along those lines. 😩 🤯 😬

So, how do you go about negotiating your audit fees? 

Old fashion strategy would be to ask for a lump-sum discount, such as “We are looking to build a long-term relationship with you, can you please give us a discount?“. You can get about 3-5% off.

✅ Smarter way of going about it would be to ask for:

• Breakdown of the fees based on the activities performed and the seniority of the person who performs the activity.
• The expected sample size for audit testing and the time estimates required per 1 case.

As soon as you get those estimates, you will be able to understand where your auditors plan to spend the majority of their time, how long things may take, and what sample sizes they are planning to review. It would give you ample material to challenge the underlying pricing assumptions in a much more constructive way, with data and logic. This way, you can reduce your costs by 10-15-20% down.

Do you see now how it starts making sense and can work for you, right? 🙋🏼