New to auditing and working my first real engagement in Greensboro with Duke Energy Carolinas. I found that the client could save money by switching from Rate OPT-V to Rate OPT-E based on their usage pattern. But this isn't an error — the client was correctly billed on their current rate, they'd just be better off on a different one. Is this a 'finding' that my contingency applies to, or is it just a recommendation?
Confused about whether my fee applies to rate changes vs error corrections
This is a rate optimization finding, and yes, your contingency should apply. Most engagement agreements define recoverable savings broadly to include rate reclassifications, tariff optimizations, and billing corrections — not just errors. The distinction between 'wrong rate' and 'suboptimal rate' is less important than the outcome: the client was paying more than necessary and your analysis identified the opportunity. Make sure your engagement agreement uses language like 'savings resulting from rate changes, billing corrections, or tariff optimizations identified by the auditor.' If your current agreement is narrower, discuss it with the client before filing.
My agreement does say 'billing corrections and rate optimizations' so I think I'm covered. Client switched to OPT-E and is saving about $700/month. My first real contingency fee. Thanks Randy.