CPA firms will be granted six-month extensions for peer reviews, corrective actions, and implementation plans with original due dates between Jan. 1 and Sept. 30 of this year, according to a vote taken Thursday by the AICPA Peer Review Board (PRB).
The PRB took the action to relieve firms that are struggling because of the impact of the coronavirus pandemic on their daily operations and their clients. The PRB and the AICPA Peer Review Program staff will continue to monitor the pandemic through the summer months and will evaluate whether automatic extensions are appropriate for firms with due dates after Sept. 30, 2020.
Despite the extended due dates, firms do not need to wait an additional six months and are encouraged to have their reviews performed as soon as they are able.
Extensions will be granted automatically in the Peer Review Program’s PRIMA operating system; it’s expected that this functionality will be available in PRIMA by the end of May. Firms will be sent letters reminding them that they need to be familiar with the regulations and requirements of their state board of accountancy, including the need to inform their state board of their extensions and to obtain the state board’s approval.
Peer review due date and corrective action due date extension letters will be uploaded in Facilitated State Board Access if the firm granted permission.
The AICPA provided four examples for how due dates will change under the PRB’s vote.
Example 1: Firm undergoing peer review:
Original due date: March 31, 2020.
Extended due date: May 31, 2020.
New due date: Sept. 30, 2020 (six months from original due date).
Example 2: Firm undergoing peer review:
Original due date: Nov. 30, 2019.
Extended due date: Feb. 29, 2020.
New due date: Feb. 29, 2020 (no change as firm’s original due date was in 2019).
Example 3: Firm required to complete a corrective action plan:
Original due date: Feb. 29, 2020.
Extended due date: April 30, 2020.
New due date: Aug. 31, 2020 (six months from original due date).
Example 4: Firm required to complete a corrective action plan:
Original due date: Sept. 30, 2020 (established by Report Acceptance Body (RAB) at June 1, 2020 meeting).
Extended due date: To be determined. (RAB established the due date after the PRB approved automatic extensions. At each meeting after PRB approval for the duration of the pandemic, RABs should consider whether an additional extension is warranted and grant it at that time.)
— Ken Tysiac (Kenneth.Tysiac@aicpa-cima.com) is the JofA’s editorial director.