Attestation Update – A&A for CPAs

Technical stuff for CPAs providing attestation services

What types of engagements are included on your peer review? Getting started on a peer review, part 4

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Your peer review will cover A&A engagements.

The work that will be included in your peer review is accounting and auditing engagements, referred to as A&A. This obviously includes all your audits under SAS. It also includes your compilation and review services under SSARS.

Not so obvious is your services under the SSAE rules. This would be all those odd projects like examinations or compilations of prospective financial statements or written assertions, and other agreed-upon procedures.

What is excluded from the A&A category? Tax work. Write-ups. Consulting projects. Outsourced CFO services.

Your peer reviewer will want to know how many engagements you performed.  Where this gets complicated is if you do monthly compilations. How many engagements are there if you provide monthly comps during the year and a review at year-end?  That would be 12 engagements – 11 compilations plus 1 review.

Your peer reviewer will also want to know how many hours were involved on the engagements. This is needed to select what engagements to look at during the review. You will need to pull out the tax, write-up, and other non-A&A work when you prepare a list of the hours for A&A engagements.

See how that could distort the picture when selecting engagements for review?  If you have some clients with monthly write-up and compilation, adding in the time for the write-ups would make the compilations look much bigger.

Written by Jim Ulvog

July 25, 2011, 8:02 am at 8:02 am

Posted in Peer Review

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