Confidentiality and Privileged Communication

Confidentiality of client communications is one of the ethical foundations of the social work profession and has become a legal obligation in most states. Many problems arise in the application of the principles of confidentiality and privilege to the professional services provided by social workers. This entry discusses the concepts of client confidentiality and privileged communications and outlines some of the applicable exceptions. While the general concept of confidentiality applies in many interactions between social workers and clients, the application of confidentiality and privilege laws are particularly key to the practice of clinical social workers in various practice settings.

Protecting a Client’s Confidences: Recent Developments in Privileged Communication Between Attorneys and Accountants

The attorney-client privilege is one of the foundations of ourjurisprudence. Originally, designed to prevent attorneys from testifying against their clients, the privilege eventually evolved to reflect legal, societal, and financial complexities. This privilege depends on full disclosure and open communication between attorney and the client in order to provide competent and adequate representation. Today, attorneys often require and rely on expert guidance of accountants for various issues pertaining to litigation and transactional work.This article illustrates how the recent cases of Commissioner v. Comcast Corp. and United States v. Textron affect privileged communications in complex tax and transactional matters between attorneys and accountants retained for the purposes of client representation. The article also offers guidance on how to preserve privilege in communication between attorneys and accountants as waiver of such privilege may have significant and costly implications. At conclusion, unresolved issues pertaining to privileged communication are discussed and solutions are offered.

Legal Advice Privilege and the Corporate Client

This article considers the question of which corporate communications attract legal advice privilege. Specifically, it assesses the implications of adopting, on the one hand, a narrow ‘control group’ test and, on the other, a broad ‘dominant purpose’ test for determining the scope of privileged communications. The Court of Appeal's decision in Three Rivers DC v Governor and Company of the Bank of England (No. 5) is compared with approaches adopted in other jurisdictions, particularly the United States. It is concluded that both tests have identifiable shortcomings. However, in light of the human rights implications of applying a broad test, it may be preferable to opt for a restrictive approach to identifying the corporate client in this context.

Corporate Disclosure Quality and Properties of Analysts' Information Environment

This study examines how the quality of corporate disclosures impacts the precision of information that financial analysts incorporate into their forecasts of annual earnings. Our empirical measures distinguish between individual analysts' common and idiosyncratic (uniquely private) information precision, and between the quality of firms' public disclosures and the quality of their private communications with analysts. We find that higher quality disclosures increase the precision of analysts' commonand idiosyncratic information. Further, we find that the increased precision of analysts' idiosyncratic information is primarily due to higher quality annual and quarterly accounting-related disclosures, publicly available to all investors. These results suggest that higher-quality public information better enables analysts to generate idiosyncratic insights. We find no evidence to suggest that the quality of analysts' private communications with management impacts analysts' information precision after controlling for the quality of publicly available accounting information. In sum, the results suggest that when forming their annual earnings forecasts, analysts rely more heavily on publicly available financial data rather than privileged communications with management.