ASB addresses agreed-upon procedures for asset-backed securities

By Ken Tysiac

A new statement of position issued Wednesday by the AICPA Auditing Standards Board (ASB) addresses the effects of changes to the attestation standards on agreed-upon procedures related to rated asset-backed securities issued in accordance with the Securities Exchange Act of 1934, as amended, when those engagements fall within the definition and scope of “third-party due diligence services.”

CPAs issue many reports annually associated with asset backed securitization issuances. SEC Rules 15Ga-2 and 17g-10 require the disclosure in Form 15E and Form ABS-15G, as applicable, of the procedures or findings, or both, of the practitioner’s services.

Statement of Position (SOP) 21-1, Performing Agreed-Upon Procedures Related to Rated Exchange Act Asset-Backed Securities Third-Party Due Diligence Services as Defined by SEC Release No. 34-72936, revises and supersedes guidance in SOP 17-1, which was issued in 2017.

The issuance in 2019 of Statement on Standards for Attestation Engagements (SSAE) No. 19, Agreed-Upon Procedures Engagements, led to the need for an updated SOP. SSAE No. 19 eliminates the requirement for the practitioner to request an assertion from the responsible party and restrict the use of the report. It also allows procedures to be developed over the course of the engagement and the practitioner to develop or assist in developing the procedures.

SOP 21-1 provides practitioners with guidance and considerations for performing these agreed-upon procedures engagements. The SOP takes effect for agreed-upon procedures engagements dated on or after July 15, 2021, and early implementation is permitted.

Ken Tysiac ( is the JofA’s editorial director.


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