The AICPA’s Auditing Standards Board has revised Auditing Interpretation no. 1, Use of Electronic Confirmations, of SAS no. 67, The Confirmation Process (AU section 330). The interpretation has been revised to provide guidance on the use of electronic confirmations and their reliability in the confirmation process.
Auditors are likely to work more with electronic confirmations as the financial sector shifts away from accepting paper confirmation requests. One example of the shift came Oct. 1 when Bank of America stopped responding to paper confirmation requests. BofA will only respond to confirmation requests submitted electronically via a designated third-party service provider.
The AICPA’s audit and attest and technical hotline staffs created a question and answer document regarding electronic confirmations and how the Bank of America decision and others like it may affect audits. The Q&A is available here.