Attestation Update – A&A for CPAs

Technical stuff for CPAs providing attestation services

Quality control system documentation must be written

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One of the changes made by SQCS 7 is that the documentation of the quality control system must be in writing.

Previously the extensive documentation depended on the nature of the firm. In a smaller firm with relatively simple procedures it did not necessarily have to be in writing.  That has changed. You must have something written down.

How to proceed? Three ideas.

Commercial practice tools – several vendors have books available that can give you lots of great tools. For some firms this may be overkill. Too much time. Too much cost.

Checklist used for peer review – when you go through a peer review, you will be asked to fill out a checklist that describes the components of your quality control system. It is possible to get this checklist, then fill it out with explanations of what you doing your firm. Then you have documentation of your quality control system! The checklist for sole practitioner is here. Checklist for two or more personnel is here.

AICPA tool – the AICPA has a practice aid on setting up a quality control system.   The text helps explain what the system ought to look like. Most helpful way for me, there were examples for sole practitioner, medium-sized firm, and multi-office firm. I used the sample for sole practitioner, modified extensively for my practice and had a very nice, useful quality control document. The title is a mouthful, Establishing and Maintaining a System of Quality Control for a CPA Firm’s Accounting and Auditing Practice – Practice Aid, but you can see it here.

Take your choice. However, remember your quality control documentation needs to be in writing.

Written by Jim Ulvog

January 15, 2011, 9:15 am at 9:15 am

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