Exposure Drafts, Comment Letters, and Statements of Position
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Periodically, the Auditing Standards Board (ASB) issues an Omnibus Statement. The Omnibus includes proposed revisions to existing standards, either Statements on Auditing Standards (SAS) or Statements on Standards for Attestation Engagements (SSAE) that have been accumulated over a period of time. The proposed revisions due to the significance of the issue and cost benefit considerations do not in and of themselves warrant the issuance of separate standards. Therefore, an Omnibus is issued. 1. SAS No. 95, Generally Accepted Auditing Standards (AICPA Professional Standards, vol. 1, AU sec. 150) provides guidance with respect to the authoritative nature of generally accepted auditing standards (GAAS). This amendment would clarify the status of appendices to SASs as being interpretive publications. 2. SAS No. 25, The Relationship of Generally Accepted Auditing Standards to Quality Control Standards (AICPA, Professional Standards, vol. 1, AU sec. 161.02 - .03), and SSAE No. 1, Attest Engagements (AICPA, Professional Standards, vol. 1, AT sec.101.17 - .18), are being amended to clarify the relationship between Statements on Quality Control Standards (SQCS) and engagements performed under SAS and SSAE. These amendments clarify that although an effective quality control system is conducive to compliance with GAAS or attestation standards, deficiencies in or noncompliance with a firm's quality control system do not, in and of themselves, indicate that an engagement was not performed in accordance with the applicable professional standards. 3. SAS No. 47, Audit Risk and Materiality in Conducting an Audit (AICPA, Professional Standards, vol. 1, AU sec. 312), paragraphs .04 and .09, require the auditor to consider adjustments individually and in the aggregate. Paragraphs .34 through .41 in the section entitled "Evaluating Audit Findings" do not indicate that the auditor should evaluate misstatements individually and in the aggregate. This proposed amendment would clarify the auditor's responsibility with respect to evaluating audit adjustments. 4. Interpretation No. 6, "Responsibilities of Service Organizations and Service Auditors With Respect to Subsequent Events in a Service Auditor's Engagement, of SAS No. 70, Service Organizations (AICPA, Professional Standards, vol. 1, AU sec. 9324.38-.40), includes guidance regarding subsequent events. This guidance currently states that "A service auditor should consider inquiring of management" about subsequent events. This proposed amendment would revise the guidance to state that "A service auditor should inquire of management" about subsequent events and bring the guidance from the interpretation into SAS No. 70. 5. The exposure draft entitled Consideration of Fraud in a Financial Statement Audit requires the auditor to make inquiries of management about fraud and the risk of fraud. In support of and consistent with these inquiries, this proposed amendment would revise the guidance for management representations about fraud currently found in SAS No. 85, Management Representations (AICPA, Professional Standards, vol. 1, AU sec. 333), paragraph 6h and Appendix A. 6. SAS No. 58, Reports on Audited Financial Statements (AICPA, Professional Standards, vol. 1, AU sec. 508.65), states that the auditor's report on comparative financial statements should be dated as of the date of completion of the most recent audit. The guidance found in SAS No. 1, Codification of Auditing Standards and Procedures (AICPA, Professional Standards, vol. 1, AU sec. 530.01, "Dating of the Independent Auditor's Report"), states that "Generally, the date of completion of the field work should be used as the date of the independent auditor's report." This proposed amendment would make the guidance in AU section 508.65 consistent with the guidance in AU section 530.01 by using the term "completion of fieldwork" as opposed to "completion of his most recent audit." 7. SAS No. 8, Other Information in Documents Containing Audited Financial Statements (AICPA, Professional Standards, vol. 1, AU sec. 550), and SAS No. 52, Required Supplementary information (AICPA, Professional Standards, vol. 1, AU sec. 558.08 and .10), do not indicate whether an auditor may issue a report providing an opinion, in relation to the basic financial statements taken as a whole, on supplementary information and other information that has been subjected to auditing procedures applied to the audit of those basic financial statements. This amendment would clarify that such reporting is allowed. 8. The applicability paragraph to SAS No. 52, Required Supplementary Information, as currently written, does not include such items as AICPA Industry Audit and Accounting Guides, which are considered generally accepted accounting principles (GAAP) as described in SAS No. 69, The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles (AICPA, Professional Standards, vol. 1, AU sec. 411), as amended. This amendment would include all sources of GAAP in the applicability section of SAS No. 52. 9. The current guidance on supplementary information is silent as to whether the auditor is permitted to report that Required Supplementary Information in an auditor-submitted document that is neither incomplete, nor otherwise deficient, is fairly stated in relation to the basic financial statements taken as a whole. This amendment would revise the gui dc2 dance in SAS No. 29, Reporting on Information Accompanying the Basic Financial Statements in Auditor-Submitted Documents (AICPA, Professional Standards, vol. 1, AU sec. 551), paragraph .15 (paragraph .15 has been split and revised as paragraphs .15 and .16), and delete footnote 6 to clarify the reporting guidance with respect to required supplementary informarion. 10. SAS No. 1, Codification of Auditing Standards and Procedures (AICPA, Professional Standards, vol. 1, AU sec. 560, "Subsequent Events), paragraph .01, currently defines subsequent events in terms of the date of issuance of the auditor's report. In order to make the auditing standard consistent with accounting standards (Statement of Financial Statement Accounting Standards No. 5, Accounting for Contingencies), this proposed amendment would delete the reference to the auditor's report from the definition of subsequent events. 11. SAS No. 1, Codification of Auditing Standards and Procedures {AICPA, Professional Standards, vol. 1, AU sec. 561, "Subsequent Discovery of Facts Existing at the Date of the Auditor's Report'), paragraph .01, and the title to the section, refer to subsequent discovery of facts existing at the date of the auditor's report. The wording of AU section 561.03, however, implies that the auditor's responsibility extends through the date of issuance of the report. This is inconsistent with the intent of the section. The proposed amendment to AU section 561.03 would clarify the auditor's responsibility with respect to subsequent events. 12. SAS No. 1, Codification of Auditing Standards and Procedures (AICPA, Professional Standards, vol. 1, AU sec. 530, "Dating of the Independent Auditor's Report'), provides guidance regarding the dating of the independent auditor's report. When discussing the time frame with respect to subsequent events, the current guidance refers to the date of issuance of the auditor's report. This amendment clarifies that the date referred to is the date of issuance of the related financial statements.
Publication Date
2002
Relational Format
Book
Keywords
Accounting -- Standards -- United States; Auditing -- Standards -- United States; Attest function (Auditing) --Standards -- United States
Disciplines
Accounting | Taxation
Recommended Citation
American Institute of Certified Public Accountants. Auditing Standards Board, "Proposed statement on auditing standards and proposed statement on standards for attestation engagements : Omnibus -- 2002;Proposed statement on standards for attestation engagements : Omnibus -- 2002;Omnibus -- 2002; Exposure draft (American Institute of Certified Public Accountants), 2002, May 15" (2002). Exposure Drafts, Comment Letters, and Statements of Position. 290.
https://egrove.olemiss.edu/aicpa_sop/290
Comments
Originally published by: American Institute of Certified Public Accountants; Copyright and permission to reprint held by: American Institute of Certified Public Accountants.