SSARS 21 CPE courses are designed to cover engagements that include unaudited financial statements and any other unaudited financial information of non-public entities. Accountants in public practice who are responsible for preparing financial statements will have to apply these changes in standards for accounting and review services. These changes are a result of the efforts by the AICPA Accounting and Review Services Committee (ARSC).
The Accounting Review Services Committee issued the Statement on Standards for Accounting and Review Services (SSARS) No. 21 on October 23, 2014. This statement clarified and revised the standards present for compilations, reviews and engagements to prepare financial statements. The Standard also incorporates certain significant revisions that are relevant for accountants in public practice.
The Format of SSARS No. 21
To give an overview of what this revised accounting standard comprises of, here is a quick list of the four sections the SSARS 21 is formatted into:
Section 60: General Principles for Engagements Performed in Accordance With Statements on Standards for Accounting and Review Services
Section 70: Preparation of Financial Statements
Section 80: Compilation Engagements
Section 90: Review of Financial Statements
SSARS 21 effective date was December 15, 2015
What has changed with SSARS 21?
The AR-C sections 60 and 90 are largely unchanged. AR-C section 80 has been revised for compilation engagements. The major difference in these compilation standards is that now they are only applicable when the CPA is engaged to provide a compilation, instead of when the CPA has to submit the financial statements to management. The new standard has replaced the management’s use only financial statements option with AR-C Section 70. This section is applicable when a CPA is engaged to prepare the financial statements, but not engaged to carry out the audit, review or compilation. The impact of SSARS 21 on this section makes the level of service provided by CPAs more applicable to today’s business environment and makes CPA firms more competitive in the market for outsourcing.
Should you be concerned about changes in SSARS 21?
With changes in this accounting standard, you need to ask yourself a few questions. These will be something on the lines of:
Are you in compliance with the new standards?
Are you aware of exactly what changes with regard to your professional duties?
Can you easily explain to clients how their representation letters would now look different?
With SSARS 21, the profession of CPA has taken a major step towards taking care of the needs of both the users and the providers of accounting services. This standard is highly useful in today’s world of cloud-driven technology. It helps the profession align with the needs of the market and enables CPA firms to capitalize on the growing market for accounting outsourcing in small companies.
If you have such concerns, you might want to invest in SSARS 21 CPE courses. These courses will help you develop your knowledge and skill set in accordance with the new set of principles.
SSARS 21 CPE Courses
To prepare yourself with the changes in this standard, you need to get proper guidance and training. Enrolling yourself in a preparatory course will do you good. Here is an overview of what a SSARS 21 preparatory course could include:
Sample Letters: These sample letters for all of SSARS engagements would help you understand the basics in detail and the changes that have been made.
Checklists for Procedures: These would include all suggested engagement work programs that are required for the preparation of financial statements, reviews and compilations. These checklists are highlighted for specific changes to make matters easier for you. This would assist you in knowing precisely what you need to perform, document and communicate differently. In addition, there would be clear differentiations for accountants regarding optional and best practices to allow them to make the best, well-informed decisions.
Management Representation Letter: This would include examples of all management representations that you will need to get in a review of financial statements. You will need to add a red-lined version of the SSARS No. 19 as well, so as to clarify the specific changes your clients have experienced.
Review Inquiries: This section would give you suggested inquiries for the performance of a review of financial statements.
Reports: These sample reports included in the SSARS 21 preparation package would include compilations and reviews and would help you identify clearly what report modifications are required. These illustrative reports would help you differentiate easily between what needs to be added or subtracted from standard reports in order to fulfill compliance requirements of the new SSARS.
Keeping yourself updated is important in this profession. If you are a CPA looking to update your knowledge according to the new standards, you might want to enroll yourself in a proper course, created specifically for this purpose.