The ASB plans

ED to Update Management Representations

S tatement on Auditing Standards no. 19, Client Representations , has been on the books for 20 years and may be headed for retirement. The American Institute of CPAs auditing standards board is exposing for comment Management Representations , which would supersede SAS no. 19 and amend other statements as well. According to the exposure drafts summary, the purpose of the statement is "to provide appropriate guidance regarding written management representations to be obtained by an auditor as part of an audit..."

Major Benefits for Journal Readers
Now theres another good reason for keeping up with the Journal . American Institute of CPAs members can earn up to 24 continuing education credits per year by reading selected Journal articles, completing four quarterly study guides and passing four quarterly examinations.

An annual subscription costs $159. For information or to order, call 1-800-862-4272 and select option #1.

James S. Gerson, chairman of the ASB management representations task force, told the Journal there were several key changes to SAS no 19. "Weve added a clarification that the auditor must retain written representations for all periods covered in the auditors report." Also new is Appendix B, "Additional Representations," which provides guidance on "tailoring letters to each engagements specific needs—something were trying to encourage," said Gerson. However they are customized, such letters are mandatory in all audit engagements.

Gerson did not expect any of the provisions in the ED to be especially controversial during the exposure period. However, he did note that paragraph 6(b), which calls for specific representations on "managements belief that the financial statements are fairly presented in conformity with generally accepted accounting principles," received a lot of attention from the board. "This is going an extra step, asking for explicit assurance," said Gerson. "It puts more responsibility on the practitioner in calling for increased dialog between auditor and client to ensure the client is comfortable with the financial statements."

Copies of the ED may be ordered from the AICPA by calling 800-862-4272 or by downloading it from AICPA Online, . Comments are due by July 31.


Year-end tax planning and what’s new for 2016

Practitioners need to consider several tax planning opportunities to review with their clients before the end of the year. This report offers strategies for individuals and businesses, as well as recent federal tax law changes affecting this year’s tax returns.


News quiz: Retirement planning, tax practice, and fraud risk

Recent reports focused on a survey that gauges the worries about retirement among CPA financial planners’ clients, a suit that affects tax practitioners, and a guide that offers advice on fraud risk. See how much you know with this short quiz.


Bolster your data defenses

As you weather the dog days of summer, it’s a good time to make sure your cybersecurity structure can stand up to the heat of external and internal threats. Here are six steps to help shore up your systems.