Changes proposed to peer review standards

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Changes proposed to peer review standards

The AICPA Peer Review Board issued an exposure draft last week that describes proposed changes to the AICPA’s current standards for performing and reporting on peer reviews.

The proposals are designed to help audit firms increase their focus on the proper design and operating effectiveness of their systems of quality control.

In addition, the proposals are intended to reinforce the need for adequate planning and preparation for a peer review by firms and peer reviewers. This would allow sufficient time for proper identification of systemic causes and appropriate remediation, when necessary.

“This exposure draft is another step in our continuing holistic initiative to further the profession’s efforts to move the audit quality needle,” James Brackens, CPA, CGMA, AICPA vice president–Ethics & Practice Quality, said in a news release. “We encourage all stakeholders to review and comment on the proposals.”

The proposed changes would:

Comments can be submitted through Jan. 31 at PR_expdraft@aicpa.org.

The AICPA peer review program monitors the quality of reviewed firms’ accounting and auditing engagements and evaluates the systems under which those engagements are performed. Participation in the peer review program is mandatory for AICPA membership, and peer review is required for licensure in nearly every state.

The proposal issued last week is another step in the AICPA’s efforts to enhance the quality of audits through the peer review program. Last year, the Peer Review Board approved a plan to implement changes to the current peer review process. The changes are part of the AICPA’s Enhancing Audit Quality initiative, under which the AICPA earlier this year issued a six-point plan to improve audits.

Part of the six-point plan included testing of firms’ controls to identify risks to audit quality.

Ken Tysiac (ktysiac@aicpa.org) is a JofA editorial director.

Research & References of Changes proposed to peer review standards|A&C Accounting And Tax Services
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