Practice Issues — Compilation and Review Update Modules I and II
Author: Steven C. Fustolo, CPA
Electronic version only
The objective of this course is to inform the reader of the various changes made to the compilation and review standards by the AICPA’s Accounting and Review Services Committee (ARSC), and to address practice issues related to compilation and review engagements.
The first section of this course consists of an overview of SSARS No. 21, as amended by SSARS Nos. 22 through 26, and addresses the three types of engagements that can be performed under the SSARSs: a preparation of financial statements engagement, a compilation engagement, and a review engagement, There is also a discussion of the new Quality Management (QM) Standards in SSARS No. 26.
The remainder of the course consists of practice issues in compilation and review engagements. Topics include a discussion of an accountant’s responsibility for fraud, internal control and going concern, representation letters for review engagements, personal financial statements, tax-basis financial statements, legends on financial statements, accountant’s liability in compilation and review engagements, saving time in engagements, and more. The focus of the course is to identify, recognize and recall the rules pertaining to various pronouncements, including those related to recent developments.
With this 20-hour course you will:
- Get a 481-page PDF manual
- Identify some of the changes in SSARS No. 21, as amended, that are and are not carried over from auditing standards
- Identify engagement types that are and are not authorized under SSARS No. 21
- Recall whether the preparation of financial statements standard is an attest or nonattest service
- Recognize the term that is assigned to engagements performed on the cash, tax and regulatory bases of accounting
- Recognize a criterion for an accountant to perform a preparation engagement
- Recall whether a preparation engagement under AR-C 70 is subject to peer review
- Identify whether a report is required in a preparation of financial statements engagement under AR-C 70
- Recognize what the reporting requirements are, if any, when a “no assurance” legend is omitted from prepared financial statements under the AR-C 70 standards
- Identify the reporting options for controllers who seek to issue financial statements
- Recognize the accountant’s responsibility for reporting fraud in compilation and review engagements
- Identify the types of analytical procedures that can and cannot be used in a review engagement
- Recognize certain terms used as the basis for evaluating going concern in a review engagement
- Identify factors that may or may not suggest there is a potential going-concern problem in a compilation or review engagement
- Identify the period of time that defines “reasonable period of time” in going concern
- Recognize the threshold to evaluate an Altman Z Score
- Identify an example of a deferred M-1 that is eliminated by tax-basis financial statements
| Designation | CPE Hours |
|---|---|
| CPA | 20 Auditing |
Course level: Overview
General understanding of compilation and review standards is required.
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Spidell Publishing, LLC is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State Boards of Accountancy have the final authority on the acceptance of individual course for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org. This self-study is designed to meet the requirements for 20 hours of continuing education for the California Board of Accountancy. Level: Overview. Field of Study: Auditing. Delivery Method: Self-Study. For more information regarding administrative policies, such as complaints or refunds, contact Spidell Publishing at (800) 277-2257. General understanding of compilation and review standards is required.
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