Starting template to develop a Quality Control document for CPA firm. It’s even legit to copy & paste.
The AICPA has provided a number of new documents to help firms improve the quality control systems and to start looking at the enhancing audit quality initiative. I’ll list a few of them. It’s easy to copy & paste and at a great price.
Tools to develop a quality-control document
Every CPA firm performing assurance services is required to have a quality-control document. That applies even if you only do comps and reviews. Even if you aren’t going through a system review.
The AICPA has free practice tools to explain the QC standards along with a sample document based on the size of the firm.
You can find the documents on this page.
You can also find a document that is geared to the size of a firm: Read the rest of this entry »
While I’ve been getting a book into print and writing some CPE classes during the last few months, Charles Hall has posted a bunch of great articles of interest to CPAs. Haven’t mentioned any of them yet. Here’s a few that I think would be most helpful for you.
- Audit Lessons from a Brain Tumor – His successful battle with brain cancer gave lessons learned that can be applied anywhere, even the middle of an audit. Great story.
- Evernote for CPAs – Great tool for accumulating your own personal library of resource articles. I use it all the time.
- Preparation of Financial Statements and Independence – You will be hearing a lot more about SKE – skills, knowledge, and experience
Here’s some more posts that would well be worth your time.
I recently had the opportunity to visit with Sam Antar, convicted felon and former CFO of Crazy Eddie. This is cross-posted from my other blog, Nonprofit Update.
During our interview, Mr. Antar suggested a reason why businesses don’t put enough effort into fraud prevention and detection. He said the cost of deterring fraud may be more expensive than the consequences of fraud. Before I refine the concept, look at some costs he mentioned:
- In the corporate world, particularly companies that have grown for a while, there needs to be a lot of systems put in place to deter and mitigate fraud risk.
- There needs to be an audit committee and they need to have resources available to them. Translate that to they have authority to hire legal and accounting experts. They need training personally. This is expensive.
- The audit committee, consisting of skilled and knowledgeable people, must have a direct line of contact to the Board of Directors. That is expensive in terms of time.
- The Board of Directors has to have a substantial amount of financial skills. That is expensive in terms of time and dollars for training and dollars for their access to expert resources.
- At some point in the growth curve, there needs to be a robust, skilled internal audit department. That could get quite expensive, if you look at it only in terms of cash outflows.
I would add to that the time involved to implement quality controls, policies, and procedures. Those will take a lot of time for the finance & accounting team. In turn, those procedures will take time for operational staff to follow. All of that translates into more staff.
That can get costly fast.
What is the cost of a fraud incident
Following discussion is cross-posted from my other blog, Nonprofit Update. This may be helpful for CPAs serving the NPO community. You can point your clients to the linked article as a way to address common basic questions.
Corey Pfaffe, CPA, provides answers to those top questions at MinistryCPA.
The questions, with links to each answer, can be found here.
You can download a superb 12 page PDF of the full set of answers here.
If you are a pastor, missionary, church treasurer, or on the finance staff of a charity, I recommend you check out Prof. Pfaffe’s superb explanations. Get professional advice to apply the information to your situation or if you need to go beyond the very straightforward answers.
There is a bonus question: Read the rest of this entry »
Sam Antar is a convict and former CPA. He was the CFO of Crazy Eddie, which by his description was an intentionally fraudulent business.
I recently had opportunity to interview him by phone. Will have more of our conversation in future posts.
What I’m going to do in these discussions is combine his comments and ideas with my thoughts. Cross-posted from my other blog, Nonprofit Update.
Advice for charities
I asked him what advice he would have for small charities to prevent fraud.
Wow, was that a mistake. I should not have used the word “prevent.”
You can’t prevent fraud. If someone is intending to steal or is completely determined to cook the books, they will find a way.
CPAs who provide attestation services need to check out the new code of professional conduct. Soon. Seriously, check it out. Before the end of the year.
Actually you should check out the Code of Professional Conduct in the next four or six weeks so you can make some changes to your engagement letters.
Yesterday I worked through the document in-depth for the first time. Will go into more detail on the code later.
A few highlights follow. Just a few.
Update: See added comment on the 12/15/14 effective date.
Identify threats and implement safeguards, then document doing both
I’ve written another batch of CPE courses for CCH.
Six one-hour modules delve into the Financial Reporting Framework for Small- and Medium-Sized Entities. That’s an entirely new reporting framework separate from GAAP that will allow for simplified reporting by smaller business entities.