PEER REVIEW

•      PEER Review is an ADVOCACY function with a REGULATORY consequence

•      For the Reviewer it is an attestation engagement

INTERNATIONAL STANDARD

•      The AICPA Standard

•      The Ten Standards for Attestation engagements

•      Variations in Canada

       Alberta

       Ontario

       BC

Ten Standards for Attestation

General Standards

•      T  = Adequate technical training & proficiency

•      I = Independence & Objectivity

•      P = Due Professional Care

Field Work:

•      P = Planning – Adequate and Assistants supervised

•      I = Internal Control understood to assess the nature,

•           extent and timing of tests

•      E = Evidential matter obtained through inspection,

•           observation, inquiry and confirmation

Reporting:

•       = Basis for Report – GAAP / other

•       = Consistency

•       = Informative Disclosures

•      =  Opinion on Report as a whole

PRP 3100

•      Standards apply to:

–   Reviews and Compilations ( no compilation alone standard exists)

–   Financial Statement preparation

–   Audits

Marking System

•      68% or higher – unqualified

•      60% or less – Qualified

•      55% or less – Adverse

Compilations / Review and Financial Statements

•      General concerns  -     8 points – 29%

•      Cash and other considerations –    4%

•      File Finalization    -                     -  21%

•      Professional Engagement  -  14%      

•      Financial Statements          -   32%        

These are maximum % with “NA” items removed  

Common Deficiencies

•      Failure to note “PBC” source

•      Failure to date w/p

•      Failure to initial w/p

•      Engagement letter deficiencies

•      Check lists absent or incomplete

•      Inappropriate compliance opinion

•    supporting documentation lacking

Common Deficiencies con’t…

•    management representation letter 

•    (CPE) requirements

•    review process failed  (self-review?) – what is it and how to do.

Link to AICPA

•      Standards PRP 3100

•      See www.canmapp.ca  under continuing education tab

SMAO Stats

•    Practices Inspected          62

•    Practices cited with deficiencies                    21

Stats cont…

•     Frequency of deficient findings by type:

•       Working Papers inadequate       14

•       Engagement Letters                   12

•       Conduct / competence                 9

•       NTR                                               9

•       No E & O insurance                          6

•     Total deficiencies cited                50

SMAO Stats cont…

   The 47 CCMAs inspected who submitted their evaluation forms on their practice inspector and the inspection program provided an overall score of 3.8 with 4 being excellent.  No scores were recorded in the fair or poor scoring categories.  The comments added to the score sheet rated some of the inspectors very highly in terms of practice knowledge and professionalism.  

Your Turn!

•      Questions

•      Comments

•      Suggestions

•      How can CanMAPP play a role in improving the PEER Review system for CMAs?