An Example of “Why” Advertisers Should Audit Their Agencies

18 Feb

Let me start by saying that I am not casting doubt on Ogilvy’s position regarding the recent allegations brought by an employee in Federal Court that they overbilled their IBM client by several million dollars between 2006 and 2011.

The question to be asked is; “Does the client know whether or not they were overbilled?” If they have not conducted an independent contract compliance audit and fee reconciliation of their agency during the time period in question, they may have to wait until the conclusion of the court case to find out the answer.

Net, net… all advertisers should conduct periodic audits of their marketing services partners to achieve the requisite levels of transparency to be able to answer questions such as this.  Right to audit clauses in client-agency agreements are negotiated as a legal and financial safeguard to provide unequivocal feedback on performance and contract compliance questions. Have you conducted an audit of your agency recently?  Read More.

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