5 posts categorized "Auditing" Feed

4 financial benefits of single audit specialization

Focus on audit specializationCan a small firm thrive by building a niche within a highly specialized audit area? My firm, Clausell & Associates, P.C., in Decatur, Georgia, has found the answer is a resounding “yes.”

Our 10-person firm opened in 1987, three years after Congress passed the Single Audit Act. This landmark legislation standardized audit requirements for states, local governments and Indian tribal governments that receive and use federal financial assistance. Our firm’s founders saw an opportunity to establish themselves in this new and growing niche. Today, single audits make up about 60 percent of our practice, so the original decision to specialize in single audits was a great move for our firm. 

For practitioners thinking that specializing may limit their practice, don’t worry. Over the years, our single audit expertise has helped to set us apart in the marketplace and drive our growth. Here are some of the rewards that we have found through single audit specialization. 

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You asked, we delivered. A more flexible attestation standard.

SlinkyWe heard from members. Their clients want them to perform procedures and report in a format similar to an agreed-upon procedures (AUP) engagement, with more flexibility. To be responsive to the needs of our members and the public, the AICPA Accounting and Review Services Committee (ARSC), got together with the Auditing Standards Board (ASB) and developed a new proposed standard, Selected Procedures. If adopted, it will address several practice issues that CPAs are experiencing today and result in a standard that is in the public interest.

Development of the procedures

In an AUP engagement:

  • The CPA performs procedures that are established by specified parties.
  • The specified parties are responsible for the sufficiency of the procedures for their purposes.
  • The engagement letter is required to include agreement on the procedures.
  • In circumstances where the procedures evolve or are modified over the course of the engagement, the CPA is required to amend the engagement letter to reflect the modified procedures.
  • The practitioner’s report is restricted to the use of those parties that established and agreed on the sufficiency of the procedures

In practice, many CPAs find that the specified parties are unable or unwilling to develop the procedures needed.

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The trait that will prevent robots from stealing your job

RobotsLet’s face it. Artificial intelligence (AI) is going to revolutionize our business environment and the profession. Advancements in AI mean that you will soon spend less time conducting time-consuming and repetitive tasks. However, just because a robot can perform certain tasks traditionally performed by a CPA, does not mean that a robot is going to steal your job. That is because humans possess traits vital to our work that robots just don’t have the bandwidth to handle. One of the most essential traits is professional skepticism.

According to the AICPA Professional Standards, professional skepticism is an attitude that includes a questioning mind, being alert to conditions that may indicate possible misstatement due to fraud or error and a critical assessment of audit evidence. It is a necessary trait that all auditors must have, and is expected of all CPAs. Here are six tips to help you enhance your professional skepticism.

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Why I’m #AuditorProud: Auditors Are Protectors

AuditorProud_2017Auditors have always played an important role in society. We validate information that helps citizens understand how towns and school districts manage their tax dollars. We assist small business owners in getting the financing they need to grow. We provide assurance on the information investors use to make decisions on where best to invest for their futures.

And as communities’ needs have grown, so too have the services auditors provide. Below are just three ways auditors have evolved the way they serve the public – and three reasons why I am proud to represent the auditing profession.

Evaluating Risk Management Programs Designed to Protect Sensitive Information

Businesses big and small are faced with cyberattacks every single day. The Equifax breach affected nearly one-third of the US population, while attacks like WannaCry and Petya impacted millions of people worldwide.

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Key Facts about a New SAS on Exempt Offerings

SAS 133A municipal government issues a bond offering after the audit report date. Or a franchisor is getting ready to prepare its annual update to its franchise disclosure document. What are the auditor’s responsibilities in each case? Practitioners with governmental clients are probably familiar with long-standing guidelines to address involvement with municipal securities offerings, however a recently issued auditing standard expands those best practices into required guidance for all exempt offerings.  

What’s the Background?

The Auditing Standard Board’s Statement on Auditing Standards (SAS) No. 133, Auditor Involvement With Exempt Offering Documents, applies to exempt securities or franchise agreements when the auditor is involved. The Securities and Exchange Commission (SEC) oversees a significant regulatory framework for publicly traded offerings, setting rules on what types of information and documents must be filed and when, and on auditor involvement. Some offerings, such as municipal securities, franchise offerings, crowdfunding, and short-term commercial paper with a maturity of nine months or less, are exempt from SEC registration rules. Exhibit A in the new SAS includes a list of exempt offerings.

Continue reading "Key Facts about a New SAS on Exempt Offerings" »

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