Statements on Standards for Attestation Engagements AICPAnaaats Clarifying

Statements on Standards for Attestation Engagements #AICPAnaaats

Clarifying the Attestation Standards Commonly known as attestation standards Apply to engagements that address subject matter other than historical financial statements, e. g: • an entity’s compliance with laws or regulations • the effectiveness of an entity’s controls over the privacy of information • a financial forecast Address examination, review and agreed-upon procedures (AUP) engagements #AICPAnaaats

Clarifying the Attestation Standards 4 “general” AT sections that provide a framework for developing an attestation engagement • AT 20, Defining Professional Requirements in Statements on Standards for Attestation Engagements • AT 50, SSAE Hierarchy • AT 101, Attest Engagements (which addresses examination and review engagements) • AT 201, Agreed-Upon Procedures Engagements #AICPAnaaats

Clarifying the Attestation Standards Currently: 6 “topic-specific” AT sections for reporting on • prospective financial information (AT 301) • pro forma financial information (AT 401) • internal control over financial reporting (AT 501) • compliance with laws and regulations (AT 601) • management’s discussion and analysis (AT 701) • controls at service organizations (AT 801) #AICPAnaaats

Clarifying the Attestation Standards Objective: to make AT sections easier to read, understand apply Redraft in clarity format New structure (objective is to eliminate repetition) • Chapter 1: Concepts common to all attestation engagements • Chapters 2 -4: Levels of service (examination, review, agreedupon procedures). - Each chapter addresses a specific level of service and builds on the common concepts chapter • Subject-matter specific chapters - Each chapter builds on common concepts and level of service chapters #AICPAnaaats

Clarifying the Attestation Standards Example – Reporting on an examination of prospective financial information • Currently, the following AT sections apply: - AT 20 - AT 50 - AT 401 • Proposed structure, the following sections would apply: - Chapter 1, Common Concepts - Chapter 2, Examinations - Chapter X, Forecasts #AICPAnaaats

Clarifying the Attestation Standards Convergence with standards of the International Audit and Assurance Standards Board (IAASB) • Foundation for the common concepts, examination, and review sections of the proposed attestation standards: - AICPA’s existing attestation standards - IAASB International Standards on Assurance Engagements (ISAE) 3000, “Assurance Engagements Other than Audits or Reviews of Historical Financial Information” (Dec 2013) - ISAE 3000 is IAASB’s framework standard for assurance engagements (equivalent of attestation engagements) - ISAE 3410, Assurance Engagements on Greenhouse Gas Emissions #AICPAnaaats

Clarifying the Attestation Standards Convergence with standards of the International Audit and Assurance Standards Board (IAASB) • AT 801 was converged with ISAE 3402, Assurance Reports on Controls at a Service Organization, when SSAE No. 16, Reporting on Controls at a Service Organization, was issued in April 2010 • Proposed “Reporting on Pro Forma Financial Information, ” includes elements of ISAE 3420, Assurance Engagements to Report on the Compilation of Pro Forma Financial Information Included in a Prospectus #AICPAnaaats

Clarifying the Attestation Standards July 2013, the ASB issued an exposure draft of the first four “chapters” • • Common Concepts Examinations Reviews Agreed-upon Procedures January 2014, the ASB issued an exposure draft of the following subject-specific chapters: • Financial Forecasts and Projections • Reporting on Pro Forma Financial Information • Compliance Attestation #AICPAnaaats

Clarifying the Attestation Standards AT 801 exposure vote on July 2014 ASB agenda • Reporting on Controls at Service Organization • Delayed to include guidance from AAG One section not being clarified: • Management’s Discussion and Analysis (AT 701) - Will remain unclarified One section moving and being replaced • An Examination of an Entity’s Internal Control Over Financial Reporting That Is Integrated With an Audit of Its Financial Statements (AT 501) - Will be moved to auditing standards • Will be replaced by generic AT 501 examination standard on internal control #AICPAnaaats

Clarifying the Attestation Standards Final clarified SSAE will contain all attestation standards • One SSAE (SSAE No. 18) even though more than one exposure draft - Expected issuance in second half of 2015 (estimate) - Proposed effective date (estimate): - No earlier than for reports dated December 15, 2015 #AICPAnaaats

Clarifying the Attestation Standards Exposure drafts http: //www. aicpa. org/Research/Exposure. Drafts/Accountingand. Audi ting/Pages/Exposure. Drafts_ASB. aspx More information Dedicated ASB Attest Clarity page on AICPA Website at http: //www. aicpa. org/Interest. Areas/FRC/Audit. Attest/Pages/Attest. Cl arity. Project. aspx #AICPAnaaats