PRP Section 4800 Summary Review Memorandum

Transcription

00-7 MAR 2013
Summary Review Memorandum
4801
PRP Section 4800
Contents
Section
Paragraph
4800 Summary Review Memorandum
Instructions ...............................................................................................................................
Summary Review Memorandum ..............................................................................................
Attachments
1. System Review Engagement Statistics Data Sheet ....................................................
AICPA Peer Review Program Manual
.01–.05
.06
.07
PRP §4800
4802
System Reviews
00-7 MAR 2013
Instructions
.01 This section of the manual contains a summary review memorandum for System Reviews. The purpose of
the summary review memorandum is to document (1) the planning of the review, (2) the scope of the work
performed, (3) the support for the type of report issued, and (4) items communicated to senior management of the
reviewed firm that were not deemed of sufficient significance to effect the report, including support for Findings for
Further Consideration (FFC) forms. This documentation is required to enable the administering entity to exercise its
oversight function in an effective and consistent manner.
.02 The attached form, if properly completed, ordinarily should provide the documentation necessary to meet
these objectives. If there is insufficient space to fully describe any matters, additional sheets should be used and
attached to the form.
.03 Questions regarding the use of this form or any other materials or about the review in general should be
directed to the staff of the administering entity or to such other individuals the administering entity may identify for
that purpose.
.04 This form must be completed on all AICPA Peer Review Program (PRP) System Reviews and must be
submitted to the administering entity, whether those reviews are conducted by a review team formed by a firm under
review or by an approved association of CPA firms.
.05 This form should be completed for System Reviews commencing on or after January 1, 2009.
PRP §4800.01
Copyright © 2013, American Institute of Certified Public Accountants, Inc.
00-7 MAR 2013
4803
Firm Number
Review Number
.06
AICPA Peer Review Program
SUMMARY REVIEW MEMORANDUM
(for System Reviews commencing on or after January 1, 2009)
Reviewed Firm’s Name
Peer Review Year End
Commencement of Review
Exit Conference
I.
Description of Firm
A. Personnel Profile (if the firm has more than one office, consider providing a breakdown by office):
Office 1
Office 2
Office 3
Total
Partners (or equivalent)
Managers (or equivalent)
Other Personnel1
Leased or Per Diem*
B. Indicate extent of industry specializations, if any:
C. Service arrangements, if any, with non-CPA owned entities with which the reviewed firm is closely
aligned through common employment, leasing of employees, equipment, facilities, or other similar
arrangements.
II.
Planning and Performing the Review
A. Composition of Review Team:
1.
2.
3.
Team Captain
Firm
Areas of Experience2
Position
Team Member
Firm
Position
Team Member
Firm
Position
1
The term personnel refers to all individuals who perform professional services for which the firm is responsible whether or not they are CPAs
(previously referred to as professional staff) (Statement on Standards for Quality Control [SQCS] No. 8, A Firm's System of Quality Control
[AICPA, Professional Standards, QC sec. 10]).
*
Leased and per diem staff are those who devote at least 25 percent of their time at the reviewed firm in performing audits, reviews, compilations,
or other attest engagements or personnel who have the partner- or manager-level responsibility for the overall supervision or review of such
engagements.
2
As it relates to the reviewed firm’s practice.
PRP §4800.06
System Reviews
4804
00-7 MAR 2013
4.
Specialist
Position
Firm
3
Areas of Experience
If a specialist is used for review of SOC 1 or 2 engagements, was the specialist selected from the
preapproved list or approved by the administering entity?
5.
Specialist
Firm
Position
If a specialist is used for review of SOC 1 or 2 engagements, was the specialist selected from the
preapproved list or approved by the administering entity?
B. Describe basis for and degree of reliance, if any, on the firm’s inspection program (reliance should not be
placed on the firm’s inspection program when one was not performed during the current year). Peer
reviewers should refer to guidance on reducing scope included in Interpretations 45-1 and 2, and
Supplemental Guidance (sec. 3100). If, after considering that guidance, the peer reviewer plans on
significantly reducing the scope of the procedures they will be performing, he/she is required to inform
AICPA technical staff during peer review planning.
C. Was the firm previously reviewed? Yes
No
If “Yes,” indicate, based on your evaluation of the
actions taken by the firm in response to the deficiencies/significant deficiencies, if any, in the prior report
and findings reflected in the FFC form(s), whether such matters required additional emphasis in the
current review and how that was done.
D. If the firm has undergone a PCAOB inspection(s), the team captain should discuss with appropriate firm
personnel the reports issued by the PCAOB, or in the absence of such reports, any findings that may have
been communicated orally, and the firm’s corrective action plans. Indicate the effects, if any, the issues
discussed could have on the planning and performance of procedures of the review. See Interpretation 40-1
for additional guidance.
3
As it relates to the reviewed firm’s practice.
PRP §4800.06
00-7 MAR 2013
4805
E. Does the firm perform audits of companies with substantially all of their operations in another country (SEC
and non-SEC)? Yes
No
If “Yes,” did the firm use outside firms or personnel to assist in performing
the audit? Yes
No
If “Yes,” discuss how the reviewed firm ensured that the work performed by
outside firms or personnel provided a reasonable basis for expressing an opinion on the financial
statements.
F. Describe any significant deviations from AICPA peer review questionnaires and checklists and explain
the reason(s) for the deviations (if documentation of approval was required prior to utilization of
materials, note that it was obtained):
G. Were you requested not to review any engagements or certain aspects of functional areas? Yes
No
If
“Yes,” did the firm submit a scope limitation waiver request to its administering entity, in accordance
with Interpretation 55-1? Yes
No
If “No,” please contact the administering entity. If “Yes,” based
on your review of the request, describe the reason for the request and whether you were satisfied as to the
reason. Review the scope limitation waiver approval from the administering entity. If the appropriate
approvals were not obtained, please contact the administering entity. If the administering entity, instead,
determined that scope is limited due to circumstances beyond the firm’s control, describe the effect on the
report to be issued.
H. Describe the key elements of the system of quality control that reside outside the firm such as, but not
limited to, associations, joint ventures, non-CPA owned entities, arrangements with other professionals
outside the firm, and other structures and arrangements that affect the firm’s system of quality control for
its accounting and auditing practice.
PRP §4800.06
System Reviews
4806
00-7 MAR 2013
H1. Describe the review team’s consideration of the quality control materials (QCM) review report for each of
the firm’s QCM providers that underwent a QCM review. Include the name of and report rating received
by each provider and the degree of reliance placed on the results of each review to reduce control risk.
Refer to Interpretation 42-2 for further guidance.
H2. If the firm uses third-party developed QCM that were not subject to a QCM review, document the review
team’s assessment of the design and implementation of the QCM. Refer to Interpretation 42-3 for further
guidance.
H3. Describe the review team’s assessment of the design and implementation of the firm’s internallydeveloped QCM as well as the firm’s policies and procedures to develop new QCM and maintain existing
QCM (for example, make updates and revisions). Refer to Interpretation 42-3 for further guidance.
I1. Describe your assessment of the inherent and control risk related to the reviewed firm’s accounting and
auditing practice and its system of quality control. The assessment of these risks is qualitative and not
quantitative. The assessment must be comprehensive and address the relevant inherent and control risk
factors. The assessment should include consideration of the control risk associated with the firm’s quality
control materials. Examples of other factors to consider are in interpretation 52-1. The assessment should
include how the combined risks impacted detection risk and, therefore, the scope of review procedures.
PRP §4800.06
00-7 MAR 2013
4807
PRP §4800.06
System Reviews
4808
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I2. Based on the preceding assessment, describe how you arrived at the office(s) and engagement(s) selected
for review. Include a discussion of how the scope of the peer review covered a reasonable cross-section of
the reviewed firm’s accounting and auditing practice, with greater emphasis on those engagements in the
practice with a higher assessed level of peer review risk.
I3. If the review was performed at a location other than the reviewed firm’s office, what factors were
considered when performing the risk assessment?
Date approval was granted from the Administering Entity: _____/_____/_____
J.
Identify the level of service and industry of the engagement that the review team selected at the
commencement of the review that was not provided to the firm in advance.
Industry
Level of Service
Did the review team deviate from this requirement or revise the original engagement selection?
Yes
No
If “Yes,” describe the changes.
PRP §4800.06
00-7 MAR 2013
III.
4809
Scope of Work Performed
A. Accounting and Auditing Statistics:4
Offices
Total
Hrs.
No. of
Engs.
Hrs.
No. of
Engs.
Hrs.
No. of
Engs.
Hrs.
No. of
Engs.
Statements on Auditing Standards
(SASs):
Audits subject to Government
Auditing Standards (GAS):5
Single Audit Act (A-133)
engagements
All others subject to GAS
Employee Retirement Income Security
Act (ERISA)
Defined Contribution Plans—
Limited and Full Scope
(excluding 403(b) plans)
(403(b) plans only)
Defined Benefit Plans—Limited
and Full Scope
ERISA Health and Welfare Plans
Employee Stock Ownership Plans
(ESOP)
Other employee benefit plans
Federal Deposit Insurance Corporation
Improvement Act (FDICIA)6
Entities subject to Securities and
Exchange Commission (SEC)
Independence Rules7
Carrying Broker-Dealers
Non-Carrying Broker-Dealers
Other
Other SAS engagements
Statements on Standards for Accounting
and Review Services (SSARSs):
Reviews
Compilations with disclosures
Compilations omit disclosures
(continued)
4
The number of engagements should include each monthly, quarterly, and annual report issued separately.
Includes only audits of entities subject to Government Auditing Standards (the Yellow Book), including audits subject to the Office of
Management and Budget Circular A-133, “Audits of States, Local Governments, and Nonprofit Organizations”.
6
This only includes audits of federally insured depository institutions having total assets of $500 million or greater at the beginning of its fiscal
year under Federal Deposit Insurance Corporation Improvement Act of 1991 (regulation 12 CFR Part 363.3 (a), in contrast to the $1 billion
threshold referred to in regulation 12 CFR Part 363.3 (b)).
7
This only includes engagements that do not fall within the Public Company Accounting Oversight Board’s definition of a Securities and
Exchange Commission issuer, including non-issuer brokers, dealers, and investment advisors.
5
PRP §4800.06
System Reviews
4810
00-7 MAR 2013
Offices
Total
Hrs.
No. of
Engs.
Hrs.
No. of
Engs.
Hrs.
No. of
Engs.
Hrs.
No. of
Engs.
Statements on Standards for
Attestation Engagements (SSAEs):
Financial Forecast and
Projection—Examination
Financial Forecast and
Projection—Other
Examinations of Service Organization
Control (SOC) Reports
SOC 1 Reports
SOC 2 Reports
SOC 3 Reports
Examinations of Written Assertions
Reviews of Written Assertions
Agreed-upon procedures
Other
TOTAL
PRP §4800.06
00-7 MAR 2013
4811
B. Engagements Reviewed:8
Offices
Total
No. of
Hrs.9
Engs.
Hrs.
No. of
Engs.
Hrs.
No. of
Engs.
Hrs.
No. of
Engs.
Statements on Auditing Standards
(SASs):
Audits subject to Government Auditing
Standards (GAS):10
Single Audit Act (A-133)
engagements
Employee Retirement Income Security
Act (ERISA)
(excluding 403(b) plans)
(403(b) plans only)
Defined Benefit Plans—Limited
and Full Scope
Employee Stock Ownership Plans
(ESOP)
Improvement Act (FDICIA)11
Entities subject to Securities and
Exchange Commission (SEC)
Independence Rules12
Other
and Review Services (SSARSs):
Reviews
(continued)
8
See footnote 4.
For engagements on which not all of the significant audit areas were reviewed, include the engagement hours that relate to the portion of the
engagement that was reviewed and note the fact in the comment section.
9
10
11
12
See footnote 5.
See footnote 6.
See footnote 7.
PRP §4800.06
4812
System Reviews
00-7 MAR 2013
Offices
Total
No. of
Hrs.9
Engs.
Hrs.
No. of
Engs.
Hrs.
No. of
Engs.
Hrs.
No. of
Engs.
Statements on Standards for
Attestation Engagements (SSAEs):
Financial Forecast and Projection—
Examination
Other
SOC 1 Reports
SOC 2 Reports
SOC 3 Reports
Other
TOTAL
Percentage of Auditing and Accounting
Practice Reviewed
Comments:
PRP §4800.06
00-7 MAR 2013
IV.
4813
Overall Findings and Conclusions:
A. Do you conclude that the firm’s system of quality control was suitably designed and complied with to
provide the firm with reasonable assurance of performing and reporting in conformity with applicable
professional standards in all material respects, with respect to the following elements of quality control? If
the conclusion is “No” with respect to any element of quality control, complete the related “Reporting
Implications” section.
Conclusion
Yes
Reporting Implications
Significant
Deficiency13
Deficiency14
No14
1. Leadership responsibilities for
quality within the firm (the
“Tone at the Top”)
2. Relevant ethical requirements
3. Acceptance and continuance of
client relationships and specific
engagements
4. Human Resources
5. Engagement performance
6. Monitoring
B. Did you consider issuing a different type of report other than the report that was issued? Yes
No
If “Yes,” describe such situation fully, including the basis for the conclusion. (See PRP § 4900 Team
Captain Checklist, II question 16 about when to consult with the administering entity).
13
“Deficiencies” and “Significant Deficiencies” should be supported by Matters for Further Consideration forms, which are summarized on the
Disposition of Matters for Further Consideration form.
14
Only a “No” answer requires responses regarding “Reporting Implications,” which should be further classified as either a “Deficiency”
(resulting in a report type of pass with deficiencies) or a “Significant Deficiency” (resulting in a report type of fail).
PRP §4800.06
System Reviews
4814
00-7 MAR 2013
C. Was the firm previously reviewed? Yes
No
If “Yes,” were any issues noted on the previous review
repeated in the report or FFC forms on the current review? Yes
No
If “Yes,” please describe what
the firm has done or plans to do (including timing) to prevent a recurrence of the issue(s) and whether you
concur with the actions taken or planned.
D. Were the issues noted in the firm’s internal monitoring procedures compared to the issues noted in the
peer review? Yes
No
If “Yes,” please list any significant differences and the reasons therefore. If
“No,” why not?
PRP §4800.06
00-7 MAR 2013
4815
E. Does the reviewed firm have more than one office? Yes
No
If “Yes,” did the review team conclude
that the degree of noncompliance at one or more offices was of such significance that a condition was
created in which there was more than a remote possibility that the office(s) would not conform with
professional standards on accounting and auditing engagements? Yes
No
If “Yes,” briefly describe
the nature and extent of the deficiencies noted in the office(s).
F. Describe the nature and extent of each issue to be discussed at the exit conference or communicated to
senior management of the reviewed firm that was not deemed of sufficient significance to include on an
MFC form, FFC form, or in the report, or other materials included elsewhere in the peer review working
papers.
PRP §4800.06
System Reviews
4816
00-7 MAR 2013
G. Did the review disclose any situations that led the reviewers to conclude that the financial statements did
not conform in all material respects with generally accepted accounting principles (GAAP) (or, if
applicable, a comprehensive basis of accounting other than GAAP) and the auditor’s or accountant’s
report was not appropriately modified? [AU-C 560; ET 203] Yes
No 15 If “Yes,”
1.
Describe such situations fully.
2.
Indicate whether the firm considered the situation.
3.
Describe the actions the firm has taken or plans to take (including timing).
4.
If the firm has taken the necessary actions, indicate whether you have reviewed documentation of
such actions (for example, reissued report and financial statements or letter recalling previously
issued reports) and whether the actions are appropriate.
5.
If the firm has not taken the necessary actions, indicate whether you concur with its planned actions
(including timing).
6.
Provide specific details on the procedures performed to expand scope and the results of the
procedures.
15
These situations should be reflected on the “System Review Engagement Statistics Data Sheet” in attachment 1, if applicable. Also, when there
is a disagreement with the reviewed firm about these situations, the reviewers should consult with the administering entity or its designee.
PRP §4800.06
00-7 MAR 2013
7.
4817
Did this situation require the issuance of a report with a grade of pass with deficiency or fail, or result in
an FFC form? Yes
No
If “No,” why not?
H. Did the review disclose any situations that led the reviewers to conclude that the firm did not perform or
report on an engagement in all material respects in accordance with generally accepted auditing standards
and other applicable standards including, where applicable, Government Auditing Standards? [AU-C 585;
ET 202] Yes
No 16 If “Yes,”
16
1.
2.
3.
4.
If the firm has performed the additional procedures necessary to support the previously issued
opinion, indicate whether you have reviewed the documentation of the additional procedures and
whether the conclusions reached are appropriate.
5.
If the firm has not performed the necessary procedures, indicate whether you concur with the planned
actions (including timing).
See footnote 15.
PRP §4800.06
System Reviews
4818
I.
17
00-7 MAR 2013
6.
procedures.
7.
an FFC form? Yes
No
Did the review disclose any situations that led the reviewers to conclude that the firm did not perform or
report on an engagement in all material respects in accordance with standards for accounting and review
services? [ET 202] Yes
No 17 If “Yes,”
1.
2.
3.
4.
If the firm has completed the necessary actions, indicate whether you have reviewed documentation
of such actions.
See footnote 15.
PRP §4800.06
00-7 MAR 2013
J.
18
4819
5.
If the firm has not yet taken the necessary actions, indicate whether you concur with the planned
6.
procedures.
7.
an FFC form? Yes
No
Did the review disclose any situations that led the reviewers to conclude that the firm did not perform or
report on an engagement in all material respects in accordance with the standards for attestation
No 18
engagements or any other standards not encompassed in items G, H, and I of this section? Yes
If “Yes,”
1.
2.
3.
See footnote 15.
PRP §4800.06
System Reviews
4820
00-7 MAR 2013
4.
If the firm has completed the necessary actions, indicate whether you have reviewed documentation
of such actions.
5.
If the firm has not taken the necessary actions, indicate whether you concur with its planned actions
(including timing).
6.
procedures.
7.
an FFC form? Yes
No
K. If any of the bolded questions in PRP Section 20,700 or 20,700A Employee Benefit Plan Audit
Engagement Checklist, were answered “no,” but you were able to conclude that the firm performed or
reported on that engagement in conformity with applicable professional standards in all material respects,
please explain why.
PRP §4800.06
00-7 MAR 2013
4821
L. If the firm conducted internal inspection procedures for the current year, did the reviewed firm’s
inspection program identify any engagements on which the firm must consider taking action pursuant to
the standards cited in items G, H, I, and J of this section? Yes
No
N/A
If “Yes,” describe such
instances fully, describe the actions the firm has taken or plans to take (including timing), and indicate
whether you concur with that action.19
L1. Based on the findings, if any, documented on FFC form(s), do you believe the firm’s response is
comprehensive, genuine, and feasible? Does the response describe how the firm intends to implement the
reviewer’s recommendation (or alternative plan if the firm does not agree with the recommendation), the
person(s) responsible for implementation, the timing of the implementation and, if applicable, additional
procedures to ensure the finding is not repeated in the future. Yes
No
N/A
L2. Based on the findings, if any, documented on FFC form(s), do you believe an implementation plan should be
No
N/A
required of the firm by the report acceptance body? Yes
19
See footnote 15.
PRP §4800.06
System Reviews
4822
00-7 MAR 2013
L3. Based on the deficiencies and significant deficiencies, if any, noted on the peer review and documented in
the report, do you believe a corrective or monitoring action should be required of the firm by the report
acceptance body? Yes
No
N/A
If “Yes,” for either, or both items, please describe the plan you
would recommend being requested, including timing, and how it integrates with the firm’s own planned
M. Did the team captain physically attend the exit conference? Yes
No
If “No,” please explain:
N. Was the majority of time in the conduct of the review spent at the reviewed firm’s office? Yes
If no, please explain:
No
Team Captain
Date
PRP §4800.06
00-7 MAR 2013
Firm Number
.07
I.
4823
Review Number
ATTACHMENT 1
†
SYSTEM REVIEW ENGAGEMENT STATISTICS DATA SHEET
Engagement Statistics
Total No.
Reviewed
Statements on Auditing Standards (SASs):
Audits subject to Government
Auditing Standards (GAS):
Single Audit Act (A-133) engagements
Employee Retirement Income Security Act
(ERISA)
Defined Contribution Plans – Limited
and Full Scope (excluding 403(b) plans)
Defined Contribution Plans – Limited
and Full Scope (403(b) plans only)
Defined Benefit Plans –
Employee Stock Ownership Plans (ESOP)
Improvement Act (FDICIA)
Entities subject to Securities and Exchange
Commission (SEC) Independence Rules
Other
and Review Services (SSARS):
Reviews
Statements on Standards for Attestation
Engagements (SSAEs):
Examination
Financial Forecast and Projection—Other
Total No. Not
Performed
and/or Reported
in Conformity w/
Appl. Prof.
Standards in All
Material Respects
REASON CODES for engagements
not performed and/or reported in
conformity with applicable
professional standards:
GAA Non-GAAS and Non-GAAP
GAP Non-GAAP
GAS Non-GAAS
SAR Non-SSARS
ATT Non-SSAE
ACTION CODES for engagements
not performed and/or reported in
conformity with applicable
professional standards:
1. Report or financial statement recalled,
revised and reissued.
2. Financial statements corrected or to be
corrected in subsequent year (issuance of
financial statement on subsequent period
is imminent).
3. Omitted auditing procedure(s) performed
or to be performed in subsequent
engagement (performance of subsequent
engagement is imminent).
4. Cause of independence impairment
eliminated.
5. Unable to apply omitted procedures.
6. Notified parties that no reliance should be
placed on the report issued.
7. Engagement letter to be prepared on
subsequent engagements where a
compilation report is not issued.
8. Engagement letter on subsequent
engagements to include the required
descriptions or statements, or additional
matters, when applicable, where a
compilation report is not issued.
(continued)
†
The information reflected on this sheet should agree with the information reflected in items III.B and IV (G–J) of the Summary Review
Memorandum.
PRP §4800.07
System Reviews
4824
Total No.
Reviewed
00-7 MAR 2013
Total No. Not
Performed
and/or Reported
in Conformity w/
Appl. Prof.
Standards in All
Material Respects
SOC 1 Reports
SOC 2 Reports
SOC 3 Reports
Other
TOTAL
II.
Reasons for engagements not performed and/or reported on in conformity with
applicable professional standards in all material respects
Type of engagement reviewed
III.
Comments
Actions to be taken on engagements which are not performed and/or reported on in
conformity with applicable professional standards in all material respects
IV.
Reason code
Engagements excluded from review‡
Action code
Comments
Excluded
reason code
Comments
EXCLUDED ENGAGEMENT REASON CODES
1.
2.
3.
4.
Subject of litigation
Subject of investigation by government agency
Client imposed restrictions
Other
[The next page is 4851.]
‡
Attach scope limitation waiver, if applicable.
PRP §4800.07

PRP Section 4800 Summary Review Memorandum

Transcription

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