Thomson Reuters has introduced PPC’s Guide to SSARS Preparation Engagements to explain the new financial statement preparation service introduced by the American Institute of CPAs’ Accounting and Review Services Committee.
The book provides guidance to help practitioners comply with the new SSARS 21 standard.
“This is the biggest change that we’ve seen to accounting and review services in decades, and there are a number of critical issues that accounting firms need to fully consider when deciding whether to provide the new preparation service,” said Scott Spradling, vice president for the Audit & Accounting unit of Thomson Reuters, in a statement. “We felt it was crucial for us to provide guidance and insights to our customers.”
The guide provides sample practice aids, including an engagement letter, engagement acceptance form, and engagement checklists. It also covers litigation and professional liabilities, quality control considerations, and requirements when prepared financial statements contain departures.
“The requirement related to financial statement departures is especially important for firms considering the preparation service,” said Kimberly Fransen, an executive editor with the Tax & Accounting business of Thomson Reuters and author of the guide. “Many firms may not realize that moving to a legend rather than a report does not alleviate their responsibility to communicate significant departures noted in the financial statements.”
The new guide includes an overview of the requirements of AR-C 70, Preparation of Financial Statements, including differences from the requirements of compilation engagements (AR-C 80), along with discussions to help practitioners determine if this is a service they wish to provide to clients. The guide provides examples to help practitioners determine when AR-C 70 is applicable and, if so, how to structure the engagement to comply with its requirements. The book offers explanations of how a firm’s quality control policies are impacted by the new financial statement preparation service, along with an illustrative engagement letter and engagement acceptance form, plus a procedures checklist to help document compliance with the requirements of AR-C 70.
While early adoption is permitted, SSARS 21 will be in effect for periods ending on or after Dec. 15, 2015.
The guide can be ordered here. It is available in print and online via Thomson Reuters’ Checkpoint research service.
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