Peer Review News

New Statement on Standards for Accounting and Review Services: SSARS No. 21

by MICPA | Mar 02, 2016   ()

The new Statement on Standards for Accounting and Review Services (SSARS No. 21) has significant impacts on the peer review process. The following points outline what you need to be aware of before starting your next peer review.

  •  Firms performing only preparation services (see the table below for a comparison of compilation and preparation services) are not required to enroll in the peer review program

  • Accountants preparing financial statements no longer need to apply different methodology to those statements meant for internal use and those for third party use
  • These changes are effective for financial statements for periods on or after December 15, 2015
  • Early implementation is permitted

Comparison of Compilation and Preparation Service

  Compilation Preparation
 When does the standard apply?
Engaged to compile
Engaged to prepare
 Is an engagement letter required?
Yes Yes
 Is the accountant required to determine if he or she is independent of the client?
Yes No
 If the accountant is not independent, is that fact required to be disclosed?
Yes N/A
 Does the engagement require a report?
Yes No*
 May the financial statements go to users outside of management?
Yes Yes
 May the financial statements omit notes?
Yes Yes

 * Legend required that no assurance provided.

Source: MICPA
Source: MICPA