Grant Thornton's 'IVA Watch' service will provide information for creditors and all stakeholders to allow them to make informed decisions in this market.
It will seek to ensure that providers are complying with current legislation and also best practice and current guidelines for IVA management as outlined in the Statements of Insolvency Practice (SIPs) issued by the Association of Business Recovery Professionals (R3).
Commenting on the launch of the IVA audit service, Mark Allen, head of IVAs at Grant Thornton, said: “Having held advanced discussions to provide IVA audits with several leading IVA providers within the industry, we believe that there is a genuine willingness by many operators to subject their processes and procedures to third party scrutiny. IVA audits will bring certainty to the IVA market, reassure users and lenders alike and hopefully help dispel some of the negative perceptions that the industry has attracted in recent months, or at least allow the creditors to distinguish the high performers in the industry.
"As the practice of auditing the systems and procedures of IVA providers develops, more and more companies will want to distinguish themselves from the market, thus putting the focus on the poorer performers to seeking improvements in efficiency and operational effectiveness which will ultimately increase the return to the creditors. No firm would be satisfied in being at the bottom of a performance table. Our belief is that IVA audits will become wide-spread within the industry in 2007.
"The IVA audits will also help banks better understand the approaches to advice and those checks and balances that often already exist among the best performing IVA providers to protect the consumer and ensure they deliver the expected dividend to the lender on a consistent basis"
Outlining a second aspect of the Grant Thornton service, Mark Allen added: "Many UK lenders have experienced challenges in structuring the sizes of their teams to deal with the growth in the number of IVA cases that need to be processed and managed on a daily basis. The IVA Watch product will also allow banks to outsource the day to day management of their increasing debt portfolios to Grant Thornton to manage the documentation and to process the claims and general correspondence. In addition, IVA Watch will capture key performance data which will prove vital to banking clients in developing their strategy on this portfolio of cases and also provide forecasting information on the IVA debt portfolio.”
To ensure independence in the audit process, the IVA caseload managed by Grant Thornton will be audited by a third party and Grant Thornton will have its own IVA cases are audited by a third party.
