Posts Tagged ‘peer review’
The AICPA’s annual Audit Risk Alert General Accounting and Auditing Developments—2016/17 provides a useful summary of common peer review findings on audits.
What I like about this particular list is that it is short enough to actually provide focus. Frequently such lists have the filter set so broadly that the list covers practically all the findings that have surfaced during all peer reviews. Sometimes I’m left with the feeling that a list of findings reads like a list of every single step you need to perform during an audit.
Here is the short list provided in the risk alert, along with my explanation:
Incorrect dating of audit report – The auditor’s report needs to be dated no earlier than when sufficient appropriate audit evidence has been obtained to support the opinion. This means Read the rest of this entry »
The Fall 2016 Update newsletter from the California Board of Accountancy shows CBA continues to be deadly serious about CPAs avoiding the peer review program.
I previously went into detail on disciplinary actions in one newsletter: If you have been blowing off Peer Review, you really ought to get with the program. This time I will just give an overview.
Revocations of license
The following article provides a superb update on recent developments in the peer review program. The article is graciously provided by the California Society of CPAs and the information described here applies in all jurisdictions across the U.S.
Because the entire article is quoted verbatim without any additional comments from me, none of the article will be placed in quotation marks.
Originally published by CalCPA (www.calcpa.org) in the October issue of California CPA magazine.
Used with written permission of the California Society of CPAs.
Be Prepared – A Comprehensive Peer Review Update
By Linda McCrone
Peer review is a successful program that helps firms improve their quality control systems and elevate the quality of accounting and auditing engagements. The AICPA contributed the software program that tracks peer reviews and the staff that manages the program. AICPA member volunteers contribute their time to oversee the program, keep the peer review program forms current and make certain that the peer review standards remain relevant. But like any successful program, peer review must continue to evolve to keep up with events.
The California Society of CPAs has a superb article on the Peer Review program in their October 2016 newsletter: Be Prepared – A Comprehensive Peer Review Update.
Here is the link again: http://californiacpa.calcpa.org/?issueID=65&pageID=15
I will check to see if I can get permission to reprint the article.
Update: CalCPA graciously gave me permission to reprint the article. You may find it here.
If your peer review resulted in anything other than a pass report there are a couple of deadlines you need to remember if you are in California.
Keep in mind you are responsible for your compliance with regulations. Here are a few tips to point you in the right direction. These comments discuss the regs in California. If you are in another state, you really ought to check out what your board of accountancy has to say. I’ll guess there is some comparable reporting requirement when a peer review does not turn out well.
Notification requirement for reports less than pass — 45 days
If you received either a pass with deficiency or a fail report, you need to be in touch with the California Board of Accountancy (CBA).
Seriously, if you are providing audit, review, or compilation services to your clients, you really need to be in the peer review program. And you really, really need to be doing fairly good work. I doubt any CPAs in California who desperately need to read this post will be doing so, but it is still worth mentioning.
The California Board of Accountancy is coming down hard on CPAs who have avoided the peer review program. Seriously missing the boat on audit quality is getting hammered as well.
The Spring/Summer 2016 edition of the quarterly Update newsletter from CBA, issue 81, has several reports of firms drawing serious sanctions. There are 21 pages of narrative describing the sanctions through April 24, 2016. Of 28 disciplinary issues, 7 deal with peer review, which are the ones I will highlight.
Here are a few recent articles of interest to auditors:
- Charles Hall discusses common deficiencies in government audits. Issues also apply to single audits for NPOs and all pension audits.
- FASB removes the effective dates from PCC alternatives, which means they can be applied at any time by a private company without going through the preferability analysis.
- FASB starts to think about whether to record expenditures for intangible assets on the balance sheet.
2/15 – Charles Hall at CPA-Scribo – Findings from Peer Reviews of Governmental Engagements – Three items to mention from this article.
First, the AICPA pulled in a selection of peer reviews performed on “must-select” engagements. The oversight was performed by highly experienced peer reviewers, meaning it is our calling CPAs who looked at the audit workpapers and peer review workpapers.
The results? Not good. Consider: Read the rest of this entry »