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Cyber Security and the Role of CPAs with Clients

Cyber Security and the Role of CPAs with ClientsA new report by joint IMA (Institute of Management Accountants) and Association of Chartered Certified Accountants (ACCA),“Cybersecurity – Fighting Crime’s Enfant Terrible,” underscores the extent to which cyber security has become an issue for all industries and how the accounting industry can be instrumental in stemming cyber losses for their clientele.

According to the report, “no one can afford to be a cyber-fool.” Accountants and finance professionals can – and should – play a leading role in defining key areas of a strategic approach to mitigating cyber crime risks, says the report. These include creating reasonable estimates of the financial impact that different types of cyber security breaches will cause so that a business can be realistic about its ability to respond to an attack and/or recover from it. Accountants and finance professionals, along with insurance colleagues, can also help organizations define a risk management strategy and set priorities for the digital resources they consider most valuable.

What type of issues should be addressed to identify and assign priorities to relevant risks within an organization? Be sure to consider the following:

  • What are the key assets that are under threat and therefore need protection?
  • Where and how are these assets stored?
  • Who has access and how are different levels of such access defined?
  • What are the known directions of attacks and threat agents?
  • What is the potential financial, operational and/or reputational damage?
  • What are the possible regulatory penalties?

Additionally, securing Cyber insurance is essential in having a robust risk management strategy. Accounting firms should reach out to insurance professionals experienced in Cyber Liability/Privacy & Network Security to secure the coverage a client needs. The key is in establishing the types of incidents for which coverage should be provided, and estimating the costs that need to be covered. Working with an insurance professional that knows the cyber insurance market and can choose the right policy that’s a good fit for the needs of the business is of utmost importance. Policy terms should be clearly defined with any potential coverage gaps addressed. Also, critical is making sure that the business fully understands the requirements of the policy and complies with them and monitoring the policy to ensure that it remains current and keeps up with all the relevant compliance issues.

At Axis Insurance Services, we are specialists in Cyber Liability insurance and work with companies across all industry sectors on mitigating and transferring their cyber exposures. We can provide your accounting firm with a tailored Cyber Liability program as well as assist you in assessing your clients’ needs for coverage. Just give us a call at (877) 787-5258 to discuss how we can be of service.

 

 

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Blogged on: March 10, 2016 by Mike Smith
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