In accordance with recently proposed revisions to professional standards, CPAs who prepare financial statements for clients would consider that a nonattest bookkeeping service and would no longer be required to perform a compilation service with respect to those financial statements unless engaged to do so. The changes, proposed in June
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Auditing / Compilation and review
The AICPA issued technical guidance on emphasis paragraphs in the auditor’s reports and on independence impairment in compilation reports. Technical Inquiry and Reply (TPA) 9160.28 regards combining going-concern emphasis with another emphasis-of-matter paragraph. This TPA explains that although AU Section 508, Reports on Audited Financial Statements (AICPA, Professional Standards), does
Lawmakers reflect on Sarbanes-Oxley’s effect on corporate culture
Former U.S. Sen. Paul Sarbanes and former U.S. Rep. Michael Oxley say the regulations they sponsored and saw signed into law a decade ago are not perfect, but led to changes in the corporate culture in the United States and abroad. Sarbanes, a Maryland Democrat, and Oxley, an Ohio Republican,
PCAOB to conduct joint audit inspections with Spain’s regulator
The PCAOB, which has been working to establish international partnerships for the purposes of conducting joint audit inspections, has entered a cooperative arrangement with the Accounting and Auditing Institute of Spain. The partnership will allow joint inspections in the oversight of audit firms subject to the jurisdictions of both regulators.
Private and public companies report rise in audit fees in 2011
Total external audit fees paid by companies rose in 2011, according to a poll of more than 270 executives. Private companies reported a 7% increase, and publicly held companies reported a 5% increase in external audit fees paid, according to the 2012 Audit Fee Survey, which was conducted by the
Corporate governance best practices 10 years after SOX
You could hardly go to a Washington hearing related to an accounting or auditing issue this spring without someone singing the praises of the Sarbanes-Oxley Act of 2002 (SOX). At a House subcommittee meeting on accounting and auditing oversight, House Financial Services Committee Chairman Spencer Bachus, R-Ala., said SOX has
Highlights of audit research
Editor’s note: This article is part of a series that samples accounting research and distills key findings for busy practitioners and preparers. The summaries explain the implications of a wide range of research and give CPAs an opportunity to apply results to their day-to-day activities. Readers interested in more detail
PCAOB invites additional comments on audit firm rotation
The PCAOB is soliciting further public comment on its concept release on auditor independence and mandatory audit firm rotation in anticipation of a public meeting on the issue Thursday in San Francisco. The comment period for the concept release was reopened Monday and will be extended through July 28. The
GASB considers proposals on reporting unfunded pension liabilities
State and local governments would be required for the first time to report unfunded pension liabilities on their balance sheets if GASB approves two proposed standards Monday. Governments would be required to disclose a net pension liability that equals the difference between the total pension liability and the value of
TPAs provide guidance on issues in auditor’s reports, compilation reports
The AICPA has issued technical guidance on emphasis paragraphs in the auditor’s reports and on independence impairment in compilation reports. Technical Inquiry and Reply (TPA) 9160.28 regards combining going-concern emphasis with another emphasis-of-matter paragraph. This TPA explains that although AU Section 508, Reports on Audited Financial Statements (AICPA, Professional Standards),
Leaders from large accounting firms bullish but monitoring regulation, complexity, human capital
Complexity and competition in the public accounting profession will rise as businesses demand more, better, faster, and cheaper. Working in teams and harnessing data will become more critical. Services in areas of assurance, audit, tax, and advisory work will remain the core, while emerging international markets will open up risk
Going concern evaluations, auditor’s reporting model on the week’s agenda
Auditors’ going concern evaluations and the auditor’s reporting model project will be among the topics discussed Thursday at a meeting of the PCAOB’s Standing Advisory Group (SAG). Established in 2003 to advise the PCAOB on the development of standards, the SAG includes auditors, investors, public company executives, and others. The
Auditing transition
With audit busy season ending, it’s time to start preparing for the transition to the clarified standards, which are effective for calendar year 2012 audits. A smooth transition requires information, education, and training. Take these steps to prepare for the clarified standards and minimize the transition’s effect on your firm
More on auditors’ reporting duties to the SEC
We are writing in response to the JofA’s February 2012 article, “What’s your fraud IQ?” (page 36). The article discusses the Foreign Corrupt Practices Act (FCPA) and includes a 10-question quiz on the FCPA. The JofA’s coverage of this topic is to be commended as it is important for CPAs
COSO postpones release of internal control framework until 1Q 2013
After receiving extensive feedback, the Committee of Sponsoring Organizations of the Treadway Commission (COSO) announced Monday that it expects to delay the release of its updated internal control framework until the first quarter of 2013. That’s a slightly later debut than COSO predicted for the framework in December, when it
PCAOB teams with German audit regulator
The PCAOB has added an audit regulator from a prominent member of the European Union to its cooperative arrangement list. On Friday, the PCAOB announced that it has entered an arrangement with the German Auditor Oversight Commission (AOC) to oversee audit firms subject to the regulatory jurisdictions of both regulators.
AICPA seeks some changes to COSO’s updated framework proposal
The AICPA is suggesting changes to the proposed, updated internal control framework of the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In a comment letter, the AICPA wrote that the framework will be a valuable resource for practitioners. But the AICPA also described concerns, some of which are
CAQ seeks more transition guidance in updated internal control framework
The Center for Audit Quality (CAQ) would like the Committee of Sponsoring Organizations of the Treadway Commission (COSO) to provide more transition guidance for users implementing COSO’s updated internal control framework. COSO is updating its 20-year-old internal control framework to provide a fresh, modern approach with explicit advice and implementation
Audit rotation debated in House subcommittee hearing
Members of Congress asked pointed questions of PCAOB Chairman James Doty on Wednesday as the hot topic of mandatory audit firm rotation was debated during a wide-ranging discussion of accounting and auditing issues in front of a House subcommittee. Rep. Scott Garrett, R-N.J., the chairman of the House Subcommittee on
Auditor’s reporting model proposal scheduled for third quarter
The PCAOB’s proposed changes to the auditor’s reporting model are on track to be issued for public comment in the third quarter of 2012, according to a standard-setting agenda the board released Monday. PCAOB Chairman James Doty said in December that he thought the proposal would be out by the
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