Had to share this painful learning experience. New auditor on my team missed a tariff rider adjustment on an OG&E industrial account - Schedule LPS had a special provision for power factor correction that we completely overlooked. Client paid unnecessary charges for 18 months before we caught it. $47,000 mistake that could have been avoided with better training protocols. How do you folks prevent these kinds of oversights with junior staff?
Rookie mistake cost client $50K - lessons learned
Ouch Susan, that hurts just reading it. Here in Missouri, Ameren has so many riders and adjustments that I created a checklist for new auditors - they can't sign off on an audit until every box is checked. Takes longer initially but prevents exactly this scenario. Power factor riders are especially tricky because they're often buried in the fine print.
We've all been there Susan. AEP Texas has some incredibly complex tariff structures and I've seen similar mistakes. I now require two-person sign-off on any audit over $10,000 in potential savings. Fresh eyes catch things the original auditor missed. Also, we maintain a database of common utility-specific gotchas that gets updated after every mistake.
Alabama Power has similar power factor provisions that caught me early in my career. Now I have junior auditors highlight every single tariff rider and adjustment factor before they even start calculating. If they can't explain what each one does, they're not ready to proceed. Painful lesson but $50K is cheap tuition compared to losing the client entirely.
PPL here in Pennsylvania has started providing tariff summaries that highlight all riders and special provisions. Wish more utilities would do this. In the meantime, I created laminated reference cards for each major utility in our territory - new auditors keep them at their desk until the info becomes second nature.
Duke Energy Ohio has a particularly nasty economic development rider that only applies to certain customer classes. I've seen experienced auditors miss it, let alone rookies. The key is creating systematic review processes that don't depend on memory or experience alone. Checklists, peer reviews, and quality control procedures are essential.
Entergy Mississippi loves to hide cost adjustments in their monthly statements. I make new hires spend a full week just reading tariffs before they touch their first audit. Boring as hell but it builds that foundational knowledge. Also helps them understand why we charge what we do - this isn't simple work despite what some clients think.
Xcel Energy here in South Dakota has relatively straightforward tariffs, but even simple utilities have gotchas. I've started recording video walkthroughs of complex audits that new hires can reference. Seeing the process step-by-step helps prevent the tunnel vision that leads to missed details.
These are all great suggestions. I've implemented the two-person review requirement and created utility-specific checklists based on everyone's input. The client was understanding once we explained the situation and showed them the recovered funds, but it was definitely a wake-up call about our training procedures.
Santee Cooper down here in South Carolina has some unique municipal utility quirks that even experienced auditors stumble over. The key is accepting that mistakes will happen and building systems to catch them before they reach the client. Quality control isn't glamorous but it's what separates professionals from amateurs.
Susan, appreciate you sharing this experience. At MLGW here in Memphis, we see similar complexity with municipal rate structures. I always tell new auditors that the day you stop double-checking your work is the day you need to find a new career. Humility and systematic processes are our best defenses against costly errors.