The Pros And Cons Of A Contingency-Based Telecom Audit Compared To A Flat Fee Audit

Posted on: 13 August 2017

There have been studies that show that up to 20 percent of all telecom charges are a mistake. And 95 percent of these mistakes favor the telecommunications carrier that is billing you. If you own a business, you may be considering having a telecommunications audit done. When this is done, an outside auditor looks at your telecommunications bills and determines whether or not you were overcharged or incorrectly charged for services. If you were, they will work with the telecommunications company to recoup some of this money for your business. When you are looking to have an audit done, you have a choice. You can go with a contingency based audit, or one where you pay based on the amount of money they recover for you, or a flat fee audit, where you pay one set fee for the audit. Learning the pros and cons may help you decide. Here are the pros and cons of a contingency based telecom audit:

The Cons of a Contingency Based Telecom Audit

  • You May End Up Paying More Than With a Flat Fee 

The downside to a contingency based audit is that you may wind up spending more than if you would have just opted for a flat fee service. Unfortunately, unless you have a general idea as to how much you have been overcharged, you have no idea which is better for you. This is a risk you take when you select a contingency based approach. 

  • Some Companies Require a Flat Fee Regardless of What is Found

The other downside to selecting a contingency based audit is that many audit companies who offer contingency-based audits still require a flat fee if they cannot find enough refunds to cover their time and expenses. This means there may be little incentive for you to select a contingency program because you will be charged a minimum or flat fee regardless. 

The Pros of a Contingency Based Telecom Audit

  • There is Incentive For the Auditor to Find All of the Mistakes

One of the benefits to selecting a contingency-based telecom audit is that there is an incentive for the auditor to find all of the mistakes. When a flat fee audit is done, the auditor is getting paid regardless of how much in errors or overcharges they find. With contingency models, they are earning a percentage of the mistakes they find, which may cause them to dig further to find these mistakes. 

  • There is an Incentive for the Auditor to Recover Your Money

The other advantage to a contingency based audit is that the auditor has the incentive to recover your money. Typically, the contingency fees are tied into actual recovery, not just the audit itself. When you pay a flat fee, there is little incentive for the auditor to work to recover your money for you quickly, because they are paid either way. If you want your money fast, a contingency audit may be better for you. 

If a contingency audit is ideal for your company, you will want to find a telecommunications contingency programs audit company to assist you. They can help you recover money that telecommunications companies have overcharged your company over the years.  

Contact a company like Kloppe Associates for more information and assistance.