Attestation Update – A&A for CPAs

Technical stuff for CPAs providing attestation services

Posts Tagged ‘SSARS 21

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

Dividing line between bookkeeping and preparation services

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Is this bookkeeping or preparation of financial statements? Image courtesy of DollarPhotoClub.com

Is this bookkeeping or preparation of financial statements? Image courtesy of DollarPhotoClub.com

SSARS #21 explicitly defines bookkeeping as being outside the scope of the SSARS literature. The question becomes what is bookkeeping and what is a preparation engagement.

The AICPA has an article that can help highlight the dividing line: Bookkeeping or preparation service? That is the question.

Article suggests three ways to look at a service to help a CPA figure out whether Section 70 of SSARS #21 applies. If you are wondering, please check out the full article.

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Written by Jim Ulvog

January 18, 2016, 7:19 am at 7:19 am

Primer on Compilation and Preparation engagements under SSARS #21

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Image courtesy of Amazon. Used for this review under Fair Use.

Image courtesy of Amazon. Used for this review under Fair Use.

Charles Hall has written a book describing a new service called ‘preparation’ and the changes for compilations from SSARS 21.

If you perform a few compilation engagements a year and have not started paying attention to the complete rewrite of comp and review rules, this is the book for you. The transition date is financial statements for years ending after December 15, 2015. Essentially this applies to all your 12/31/15 comp and review work.

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Written by Jim Ulvog

December 2, 2015, 6:47 am at 6:47 am

AICPA Webcast on SSARS 21 implementation

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An upcoming webcast will address SSARS No. 21 Implementation Strategies.

The two-hour class will be offered by the AICPA multiple times this fall. Check your schedule for

  • September 15
  • October 20

As mentioned in the AICPA’s promo piece linked above, here are just a few of the topics that will be discussed: Read the rest of this entry »

Written by Jim Ulvog

August 17, 2015, 8:08 am at 8:08 am

Posted in Compilations & reviews

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Frequently asked questions about SSARS 21

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For a limited time, the AICPA’s Center for Plain English Accounting is making three of their reports available for free. You can find them here.

Of particular note is SSARS No. 21: Frequently Asked Questions and Answers. There are 22 Q&A that can help you get oriented on a new way to do reviews, comps, and preparation engagements. Also provides good implementation ideas.

Might want to check it out quickly and archive a copy since there is no comment on how long these items will be made available on a complimentary basis.

Looks like the CPEA has some good resources. Seems like a good idea to have their voice inside the AICPA world. However, at an annual membership cost of $795 for a firm with five or less professionals, I won’t be joining anytime soon.

Written by Jim Ulvog

July 30, 2015, 6:53 am at 6:53 am

Posted in Compilations & reviews

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10 most popular posts at CPA-Scribo

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Charles Hall has posted a list of the most popular posts at his blog, CPA-Scribo. I heartily recommend all of the following. Pick a few and dive in. You will learn a lot. I promise. Read the rest of this entry »

Written by Jim Ulvog

February 2, 2015, 8:11 am at 8:11 am

More good stuff for auditors – 1/9

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A few articles for your growth. Comp and Review reports under SSARS 21 and 19. Bake-your-own net income measures. Lunch money thief gets 5 years in prison and $1.8M restitution

1/7 – CPA-Scribo – SSARS 21 Reports – Preparation, Compilation, and Review – Charles Hall has a great post providing sample reports under SSARS 21. Gives the reports under SSARS 19 for contrast. You gotta’ check it out.

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Written by Jim Ulvog

January 9, 2015, 7:45 am at 7:45 am

Effective date of SSARS #21 and ideas on how to use the early implementation option

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The effective date of each section of SSARS #21 is for financial statements for periods ending on or after December 15, 2015.

On a practical basis, for most accountants that means your clients with fiscal years ending December 31, 2015 will be the first set of reports for which you must apply SSARS 21. I have to simplify effective dates to keep them straight, so here goes:  SSARS 21 applies for 12/31/15 balance sheets.

That means you will need to apply SSARS 21 for work performed in early 2016 on 12/31/15 financials.

Early implementation allowed

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Written by Jim Ulvog

December 15, 2014, 7:15 am at 7:15 am

Page count for SSARS 21

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Another thing you may enjoy about SSARS 21 is the slim size.

The full document is 157 pages long, but of that the front matter is 6 pages and the contents listing takes up 7 pages.

Section 60, General Principles, is 18 pages long including 2 pages of exhibits. So that is 16 pages of text. Read the rest of this entry »

Written by Jim Ulvog

October 31, 2014, 9:31 am at 9:31 am

Sample accountant’s review report for SSARS 21

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The accountant’s report for a review engagement has been revised by SSARS 21. Here is an example of the standard report and then a modification of the standard report.

Copy and paste at your risk.

Illustrative comparative review report

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Written by Jim Ulvog

October 29, 2014, 8:35 am at 8:35 am

Video overview of SSARS 21

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The AICPA has a great five-minute video providing an intro to SSARS 21.

Check out:

http://bcove.me/an1n50s5

Can’t go into much detail in five minutes, but it is a superb place to get started.

 

Written by Jim Ulvog

October 28, 2014, 22:15 pm at 10:15 pm

Posted in Compilations & reviews

Tagged with

Sample compilation report under SSARS 21

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Update: If you are checking out the requirements for compilation reports, you might benefit from buying a Primer on Compilation and Preparation engagements under SSARS #21. Book is written by my friend, Charles Hall, CPA. For Wednesday 12/2 the price is a mere $0.99.

Here is the new compilation report that will be used when SSARS 21 goes into effect.

I will provide three examples. First, the illustrative standard report. Second, modification of the standard report for a sole practitioner. Third, modification for a non-profit organization.

Copy and paste at your own risk.

Illustrative standard report Read the rest of this entry »

Written by Jim Ulvog

October 28, 2014, 7:10 am at 7:10 am

Flash update on SSARS #21

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Written by Jim Ulvog

October 25, 2014, 9:41 am at 9:41 am

SSARS 21 will be issued 10/23; will allow “preparation” and revise comp & review standards

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The rewrite of SSARS into clarified format will be issued this week, Thursday, October 23.

Here is a one sentence summary: The new document will completely rewrite the SSARS literature, will add a new service called “preparation”, and will add new requirements for comps & reviews.

For a bit more information, check out AICPA Modernizes Non-Audit Standards for Accountants in Public Practice.

Written by Jim Ulvog

October 21, 2014, 7:24 am at 7:24 am

Newly approved SSARS will allow a new service, ‘preparation’. Will also require written & signed engagement letters.

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Update – See also:

In August, the Accounting and Review Services Committee approved the clarified SSARS. This rewrites the SSARS into the same clarified format we saw with the audit literature.

The biggest change is the introduction of a new service, called preparation, which will allow a CPA to issue financial statements without providing an accountant’s report or performing procedures on the information.

In highly condensed terms, Read the rest of this entry »

Written by Jim Ulvog

August 28, 2014, 7:52 am at 7:52 am