Employee compensation, especially senior executive compensation for small to medium size companies, has become the number one area for audit scrutiny. Such scrutiny includes adequacy of “internal controls” in establishing compensation levels and questioned costs over audit determined levels of “reasonableness.” Government positions are sometimes based on excessive subjective considerations and limited understanding of compensation principles so an effective challenge needs to be based on objective data and strong counter-arguments that have proven to work. Our consulting staff has extensive experience on both sides of the table - members of government compensation teams evaluating executive pay and specialists helping establish compensation levels as well as challenging adverse audit findings. Our access to a wide range of compensation surveys and other resources together with our extensive knowledge of the rules and guidelines allow us to put forth reasoned positions that normally result in modifications to audit positions.

Typical engagements include:

• Helping establish reasonable compensation levels
• Reviewing the process of establishing compensation levels to help ensure proper procedures are used to minimize opportunities for negative findings
• Evaluating reasonableness of government positions taken
• Countering government’s use of compensation surveys and percentile level assumptions
• Preparing reasoned position papers that provide the basis for either challenging an audit position or, at least, providing justification for a compromise solution

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