Highlights from compilation and review risk alert – Clarity project

This is the first of several posts talking about new issues in the compilation and review world.

Last week I read the 2012/13 comp and review risk alert, available here from the AICPA.

Yes, yes, I know I should have read this about 45 days ago. Just a wild guess, but I’ll guess I’m not the only one that has not gotten around to looking at this before now.

I’ll mention a few highlights. If you provide compilation or review services to your clients, it would be wise to read the alert yourself.

Clarity project for SSARS

The Accounting and Review Services Committee (ARSC) is in the process of rewriting the SSARS in a manner similar to what has been done in the clarity project for SASs.  Paragraph .07 says the literature will be redrafted with these parameters:

  • Establishing objectives for each clarified AR section
  • Including a definitions section, where relevant, in each clarified AR section
  • Separating requirements from application and other explanatory material
  • Numbering application and other explanatory material paragraphs using an A- prefix and presenting them in a separate section that follows the requirements section
  • Using formatting techniques, such as bulleted lists, to enhance readability

The exposure drafts I’ll mention in the next post have been written in this format.

If you are really interested, you can follow ARSC meetings here.

Update:  Right after posting this, I read the CPA Letter Daily pointing to this article, AICPA committee withdraws compilation, association ED. The article says the ARSC has withdrawn the exposure draft on compilations. It will be rewritten.

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