ABOUT PEER REVIEWS
If you perform compilations and/or reviews (and no audits), you most likely need an Engagement Peer Review every three (3) years to satisfy state and/or AICPA licensing requirements. The AICPA Peer Review program is administered by the State Society of CPAs and the peer review is conducted by an independent CPA (peer reviewer). Our firm has been performing peer reviews since 1991.
We currently are performing peer reviews in 42 states for firms issuing compilations and/or review financial statements. In addition to the peer review, we strive to pass along tips and suggestions to add value to your peer review. We offer fixed fee pricing for Engagement Peer Reviews.
Please contact Angie in our office at 706-861-9636 ext. 6 with questions or to schedule a peer review.
COMMON MISTAKES NOTED ON PEER REVIEWS
Top 5 Reporting Issues:
- Accountant’s Report not updated to current professional standards (SSARS 21).
- Failure to include paragraph headings in review report.
- Report for cash or tax basis statements does not state that management is responsible for determining that cash/tax basis is an appropriate reporting framework.
- Did not report on interim or comparative statements or supplemental statements.
- Used GAAP wording on cash/tax basis statements.
Top 5 Documentation Issues:
- Engagement Letter not updated to current professional standards (SSARS 21).
- Engagement Letter does not document all non-attest services provided (i.e. preparation of financial statements, tax services, and/or bookkeeping).
- Management Representation Letter does not cover prior year if comparative.
- Management Representation Letter dated prior to the date of the Accountant’s Report.
- Analytical procedures not sufficient – Accountant didn’t document developed expectations.
Top 5 Financial Statement Issues:
- The current portion of a long-term note is not presented on the balance sheet.
- Cash/tax basis statements use GAAP titles.
- Items not properly classified on the cash flow statement.
- No cash flow statement for each income statement presented.
- No depreciation expense on interim income statements.
Top 5 Missing Disclosures:
- The date through which subsequent events have been evaluated.
- Use of estimates.
- Notes payable details.
- Details of stock ownership, par value, etc.
- Industry specific disclosures (i.e. revenue recognition method used for a construction contractor).