Attestation Update – A&A for CPAs

Technical stuff for CPAs providing attestation services

Posts Tagged ‘quality control

New CPE requirement in California for CPAs who only perform preparation engagements

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Image courtesy of dollarphotoclub before merger with Adobe Stock.

Big news from CBA if the highest level of service you provide clients is a preparation engagement.

First, if you don’t perform compilations, reviews, audits, or other services covered by peer review, you don’t need to get a peer review.

Second, there is a specific CPE requirement:  4 hours in fraud education and 8 hours in prep or A&A.

The following article from the California Board of Accountancy, quoted with permission, provides more detailed explanation.  Since it is quoted verbatim, I won’t put quotes around the entire article.

 

NEW CONTINUING EDUCATION REQUIREMENT FOR PREPARATION ENGAGEMENTS

CPAs who perform preparation engagements as their highest level of service are subject to a new continuing education (CE) requirement.

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Written by Jim Ulvog

February 19, 2018, 7:57 am at 7:57 am

How to stay away from the most popular ways to get in trouble with the California Board of Accountancy.

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Don’t send one of these to CBA unnecessarily. Image courtesy of Adobe Stock.

These must be the preferred ways CPAs pick to get in trouble with the regulators because the board of accountancy says these are the three most common reasons they issue monetary penalties.

What are the three most popular ways to draw a fine from CBA?

  • Don’t get minimum of 20 hours each year of your license term or don’t get 12 of those hours in technical topics.
  • Ignore a formal inquiry from CBA.
  • Don’t submit that Peer Review Reporting Form with your license renewal.

For more detail, check out the following article, quoted with permission, from the California Board of Accountancy.  Since it is quoted verbatim, I won’t put quotes around the entire article.

 

IT’S EASY TO AVOID CBA CITATIONS

To help increase awareness of CBA requirements and prevent licensees from receiving a citation, below are the top three violations that led to a citation in the previous fiscal year. Citations are posted on the CBA website and may include an administrative fine of $100 to $5,000.

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Written by Jim Ulvog

February 16, 2018, 5:00 am at 5:00 am

Highlights of common deficiencies in compilation and review engagements

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Image courtesy of Adobe Stock.

There is a six page listing of common deficiencies identified during peer reviews of complexion and review engagements described in the AICPA’s new risk alert Developments in Preparation, compilation, and Review Engagements – 2017/2018.

Here are a few paraphrased highlights of the deficiencies. I will list items that I perceive are more serious or more pervasive.

You might consider reading through the full list and mentally comparing it to how you perform review and compilation engagements to see if there’s something you are missing.

Here are some of the highlights:

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Written by Jim Ulvog

January 10, 2018, 9:26 am at 9:26 am

Free resource you can copy and paste to develop a Quality Control document for a small CPA firm.

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Cover of free resources from AICPA, used under fair use.

Did you know the AICPA has provided a tool you may use as a starting template to develop a Quality Control document?

If you perform compilations, reviews, or audits, you are required to have a written QC document. Even if you aren’t going through a system review. Even if you only do comps.

If you perform audits and will have to go through a system review, keep in mind you are obligated to have quality control program in place before the system review starts, even before the peer review year begins. That means you really really need to have a QC document in place. (Yes, I’m talking to you, my fellow sole practitioners.)

The AICPA’s template can give you an easy starting point, in case you want to step up your policy.

There are two documents, one tailored for a sole practitioner and the other for small firms. Here are links to the documents:

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Written by Jim Ulvog

July 13, 2017, 7:08 am at 7:08 am

More good stuff for CPAs: fees increasing and level of change increasing

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Image courtesy of DollarPhotoClub.com

Image courtesy of DollarPhotoClub.com

Two articles for your consideration:

  • We need to figure out how to ‘surf’ the massive waves of changes surrounding us.
  • Some CPAs are able to post fee increases. From my perception, that is a big change after seven years of economic hangover from the Great Recession.

3/24 – Tom Hood on LinkedIn – Why Accountants Must Learn How to Ride These Big Waves of Change – There are massive waves of change on the horizon. Risks of getting drowned are high for accountants and auditors.

We need to understand what those two comments mean and how to cope with the implications. Tom Hood’s article points toward those waves that are soon to crash down on our heads.

It’s a VUCA world

Major changes we are in can be summarized by that phrase: Read the rest of this entry »

Written by Jim Ulvog

March 28, 2016, 9:28 am at 9:28 am

More good stuff for auditors – 3/3/16

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Image courtesy of DollarPhotoClub.com

Image courtesy of DollarPhotoClub.com

A few articles for CPAs.

  • A ‘virus’ that can infect your quality control system.
  • How to quickly check if someone is licensed.
  • Risks of working for the Big 4.
  • Deep background on the Private Company Council.

2/10 – CPA-Scribo – How Internal Viruses Affect Accounting Firms – No, not the kind of viruses you were thinking. This is caused by staff doing a quick search on the ‘net to find a sample note and pull down an erroneous example, which spreads to most financial statements issued over the next year.

Charles Hall provides a frighteningly real illustration how such a virus could hit a firm.

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Written by Jim Ulvog

March 3, 2016, 8:19 am at 8:19 am

Posted in Accounting, Audits

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Ulvog CPA passes Peer Review inspection

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Image courtesy of DollarPhotoClub.com

Image courtesy of DollarPhotoClub.com

I am pleased to report my firm passed peer review in 2015.

Peer review is a process CPAs go through to inspect their audit and review work. Experienced CPAs from another firm look at your quality control procedures and read through workpapers for a selection of engagements.

(Cross-posted from my other blog, Nonprofit Update.)

In the current system there are three grades from a peer review inspection:

  • Pass
  • Pass with deficiency
  • Fail

I am pleased to report my firm received a pass report, the highest level currently available. I have gone through peer reviews in 2015, 2012, 2009, 2006, and 2003. Each time I received the highest grade possible.

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Written by Jim Ulvog

February 4, 2016, 15:55 pm at 3:55 pm

Posted in Audits, Peer Review

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