Attestation Update – A&A for CPAs

Technical stuff for CPAs providing attestation services

Frequent issues on Reviews during peer reviews – from the 13/14 Comp and Review Alert

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The Compilation and Review Developments – 2013/14 Alert provides some good comments on issues in reviews that pop up frequently during peer reviews.

A wise CPA would read through this list and mentally check to see if any of those issues are present in his or her engagements. Even wiser step would be to pull out a couple sets of workpapers to see how you compare. (We call that monitoring – write a quick memo that you checked a few files – your peer reviewer will be happy.)

Here’s a few of the common issues.

Document expectations in analytical procedures

The first step in performing an analytical review is to figure out whether you expect a number or ratio to go up, down, sideways, and why. THEN you do the calc. Then you evaluate the result based on your expectation.  The first step really needs to be documented.

Representation letters

There are a number of new comments required by SSARS 19. Apparently those are getting missed a lot.

Wording for accountant’s report

SSARS 19 made radical changes to the accountant’s report. Miss that and you are in trouble on your peer review. My impression is there are still a lot of CPAs who haven’t caught on to this. If you don’t know what SSARS 19 refers to or what that new four paragraph report looks like, you really need to do some research.

In addition, a specific title to the report is needed along with an “appropriate salutation” or addressee.

I’ve written a lot of posts on this issue. You can see them using this tag.

Engagement letters

Check out comments in previous post.

Report references all years included in the financials

Check that the years mentioned in your report are the same as the years mentioned in the client’s financial statements.

Next post: common issues in compilation engagements

Written by Jim Ulvog

January 16, 2014, 8:47 am at 8:47 am

Posted in Compilations & reviews

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