What information does the auditor ask the attorney to provide on pending or threat- ened litigation?

The auditor requests that the attorney provide the following information on pending or threatened litigation:

•  A list and evaluation of any pending or threatened litigation to which the attorney has devoted substantial attention. The client may provide the list.
•  A listing of unasserted claims and assessments considered by management to be probable of assertion and reasonably possible of unfavorable outcome.
•  A description and evaluation of the outcome of each pending or threatened litigation. This should include the progress of the case, the action the entity plans to take, the likelihood of unfavorable outcome, and the amount or range of potential loss.
•  Additions to the list provided by management or a statement that the list is complete.
•  Comments on unasserted claims where his or her views differ from management's evaluation.
•  A statement by management acknowledging an understanding of the attorney's professional responsibility involving unasserted claims and assessments.
•  Indication if his or her response is limited and the reasons for such limitations.
•  A description of any materiality levels agreed upon for the purposes of the inquiry and response.
  
  An unasserted claim or assessment is one in which the injured party or potential claimant has not yet notified the entity of a possible claim or assessment. Attorneys may be reluctant to provide the auditor with information about the unasserted claims because of client-attorney privilege. Attorneys may also be concerned that disclosure of the unasserted claim may itself result in lawsuits.