Operational forensics for boards of directors
When a board suspects that losses, favoritism or control failures are hiding in day-to-day operations, the usual tools often miss them. A financial audit reviews what's already in the books. Internal audit usually reports to the management being questioned. Cingilek Precision works for the board itself, under the board's counsel. We look at operations where they actually run, before problems reach the books.
How engagements are governed
Engaged by the board, not management
We accept engagements only from a board of directors or a designated board committee, never from the CEO or management.
Under counsel of record
Work is performed at the direction of the board's attorney, so findings can be protected under attorney-client privilege and work-product protection.
Evidence handled for court
Chain of custody is documented from the first day. Evidence is retained for seven years.
Defined in writing
Every engagement starts with a signed letter that sets scope, deliverables, evidence handling and fees.
What we look at
Losses and operational capture tend to start in the same places.
- Inventory reconciliation and shrink
- Fuel receipts, dispensing and variance
- Cash handling and deposits
- Dispatch and work-order discretion
- Vendor selection and payment approval
- The reports a board actually receives
The pattern we look for most is the same person controlling both an operation and the reporting on it.
Engagement types
Diagnostic review
One operational area, 30 to 60 days, fixed fee.
Embedded engagement
On-site or partly remote, 90 to 180 days, with deeper access to systems and staff.
Standing board retainer
Ongoing monitoring with a board-facing dashboard and monthly reporting.
What the board receives
A findings package written for directors, not accountants.
- The control gaps found
- The exposure each one creates, quantified where the evidence allows
- The documents behind each finding
- A remediation plan with owners and dates
The package goes to the board and its counsel only.
Who it's for
- Boards of Alaska Native Corporation subsidiaries
- Tribal enterprise boards
- Boards and owners of closely held companies with remote or cash-intensive operations
Why Cingilek
The practice was designed by someone who has run the kinds of operations it examines, including retail, fuel, logistics and an accredited laboratory, after twenty years as an Army logistics officer. He knows where controls fail because he has had to build them.
Common questions
Why not use our financial auditor?
A financial review or audit tests what has been recorded. Operational forensics examines how transactions are created in the first place, which is where most operational losses start. The two work best together.
Can management hire you for this?
No. If management is part of the question, the work has to answer to the board.
Will employees know you're there?
It depends on scope and counsel's direction. Diagnostic reviews can often run on records alone. Embedded engagements involve interviews.
What happens if we find something serious?
Findings go to the board and its counsel, who decide next steps. Those can include remediation, employment action, insurance claims or referral to law enforcement.
For a confidential conversation, a board member or counsel can write to jason@cingilek.com. Please don't send documents until an engagement letter is signed.
jason@cingilek.com