Academic journal article Journal of Accountancy

Statement on Standards for Accounting and Review Services - Revised Applicability of Statements on Standards for Accounting and Review Services

Academic journal article Journal of Accountancy

Statement on Standards for Accounting and Review Services - Revised Applicability of Statements on Standards for Accounting and Review Services

Article excerpt

(To revise paragraph .01 of AR section 90, Review of Financial Statements [AICPA, Professional Standards, vol. 2])

The Applicability of Statements on Standards for Accounting and Review Services

1. The purpose of this amendment is to revise paragraph .01 of AR section 90, Review of Financial Statements (AICPA, Professional Standards, vol. 2), so that Statements on Standards for Accounting and Review Services do not apply when the provisions of Statement on Auditing Standards No. 100, Interim Financial Information, as amended (AICPA, Professional Standards, vol. 1, AU sec. 722) apply New language is shown in boldface italics; deleted language is shown by strikethrough.

.01 This section establishes standards and provides guidance on reviews of financial statements. The accountant is required to comply with the provisions of this section whenever he or she has been engaged to review financial statements, except for reviews of interim financial information if the following are true:

a. The entity's latest annual financial statements have been audited by the accountant or a predecessor.

b. The accountant either

i. has been engaged to audit the entity's current year financial statements, or

ii. [begin strikethrough]the accountant[end strikethrough] audited the entity's latest annual financial statements and, when it is expected that the current year financial statements will be audited, [begin strikethrough]expects to be engaged to audit the current year financial statements[end strikethrough] the appointment of another accountant to audit the current year financial statements is not effective prior to the beginning of the period covered by the review.

c. The [begin strikethrough]client[end strikethrough] entity prepares its interim financial information in accordance with the same financial reporting framework as that used to prepare the annual financial statements. …

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