Peer Review

---

• About Peer Review
• FAQs
• Peer Reviewers
• Licensure/Firm Registration
• Independence
• Peer Review Structure and Types of Reports
• Fee Schedule
• Navigating Through the Revised AICPA Standards for Performing and Reporting on Peer Reviews Effective January 1, 2009 
• Peer Review Days
• Becoming a Peer Reviewer
• CPE Classes for Peer Reviewers
• Meet the Peer Review Board
• Engagement Selection Based on Risk Assessment for System Reviews 
• Directory of Peer Reviewers 
   

About Peer Review

The American Institute of CPAs (AICPA) established the Peer Review Program nearly 20 years ago to enhance the quality of accounting, auditing, and attestation services performed by AICPA members in public practice.  The AICPA Peer Review Program illustrates the accounting profession’s dedication to integrity and protection of the public and is driven by adherence to the highest possible professional standards. 

The AICPA Peer Review Program is well-respected by practitioners, state boards of accountancy, and other users of the peer review process, who recognize the program as an effective quality improvement tool.

Since 1987, over 50,000 CPA firms have undergone more than 160,000 peer reviews, resulting in reports that provide insight into participating firms’ quality control standards and their real-world use of those standards.  Approximately 32,000 firms are currently subject to peer review, with 41 individual state CPA societies serving as administering entities in the 55 licensing jurisdictions.  Currently, 39 states require peer review as a condition of firm registration. Colorado law does not require it.

Peer review provides a mechanism for a firm to engage a peer firm to review its system of quality control related to its application of professional accounting, auditing, and attestation standards.  The AICPA Peer Review Program focuses on strengthening member firms’ quality control and encourages firms to improve processes and correct shortcomings.

To be admitted or to retain membership in the AICPA as well as the CSCPA, members who are engaged in the practice of public accounting in the U.S. or its territories are required to be practicing as owners or employees of firms enrolled in a practice-monitoring program. If practicing in firms not eligible to enroll, the are themselves enrolled in such a program if the services performed by such a firm or individual are within the scope of the AICPA’s practice-monitoring standards and the firm or individual issues reports purporting to be in accordance with AICPA professional standards. Firms that perform tax services only are not required to enroll in a practice-monitoring program. 

A peer review is conducted in compliance with the confidentiality requirements of the AICPA Code of Professional Conduct. Information concerning the reviewed firm, its clients, or its personnel, including the findings of the review. are confidential.

Back to Top

FAQs

What is Peer Review?

Carried out in conjunction with participating administering entities and overseen by the AICPA, the Peer Review Program requires CPAs to undergo a rigorous outside review of their accounting and auditing practices once every three years. This review determines whether a firm has suitable quality control policies and procedures in place and is complying with them. Peer Review focuses on the following: 

• How the firm implements independence, integrity, and objectivity requirements
• How personnel are managed
• How auditing of clients is performed
• Acceptance and continuation of clients and engagements
• Monitoring of the firm’s work

This self-regulatory tool is designed to maintain and improve the quality of the accounting and auditing services performed by CSCPA members.

What are the practice-monitoring requirements, and does my firm have to enroll in a practice-monitoring program?

Firms performing accounting, auditing, and attest engagements are required to enroll in a practice monitoring program.

Peer Reviewers

• Must complete a peer review training course when the function of reviewer goes beyond reviewing engagements
• All firms that the member is associated with should have received an unmodified report on the review of its system of quality control or an unmodified report on its engagement review for its most recent peer review that was accepted within the last three years and six months
• All members of the system review team must be approved by the administering entity prior to the commencement of the review
• Peer reviewers are required to update their resumes on an annual basis - log on to the AICPA website at http://www.aicpa.org/members/div/practmon/intrev.htm/ or e-mail Jill Turner or call her at (303) 741-8605 or (800) 523-9082, ext. 105 for assistance

Back to Top

Licensure/Firm Registration

Firms are required to comply with the rules and regulations of state boards of accountancy and other regulatory bodies in the states where they practice. Reviewers should continue to make inquiries of the firm to determine if it is appropriately licensed and/or registered as required. The reviewer must analyze the information obtained through inquiry and in the written representation letter to determine the impact on the report and letter of comments.

Back to Top

Independence

Do you prepare journal entries or tax returns for compilation, review, or audit clients? If so, you are performing nonattest services for attest clients, and Ethics Interpretation 101-3 (ET 101.05) applies. For audits and reviews, you must be independent. For compilations, you can either be independent or state in the compilation report that you are not independent. To be independent under this standard, you and your client must agree that there is a competent employee to oversee the performance of your nonattest services. In some cases, the bookkeeper may not be sufficiently knowledgeable; the owner will be the designated the  “competent employee.” For services performed after December 31, 2004, this understanding must be documented (commonly in engagement letters) prior to performance of the nonattest services. Specific documentation requirements include engagement objectives, applicable limitations, the nature of the services to be performed, and both the firm’s and the client’s responsibilities. The documentation requirement does not apply prior to a client becoming an attest client (for example, a tax return client who later needs a financial statement).

For guidance on this complicated issue, visit the AICPA Web site to determine what other nonattest services you perform for your attest clients. The AICPA provides extensive information on this issue under the “Professional Ethics” link. Also, PPC has written an excellent white paper with sample engagement letter wording that is available at PPC (click on the “downloads” link).

Back to Top

Peer Review Structure and Types of Reports

What are the Various Types of Peer Reviews?

Currently there are two types of peer reviews: system reviews and engagement reviews. Beginning 1/1/09 when the new Standards became effective report reviews rolled into engagement reviews. The type of peer review that is performed on a CPA firm is dependent upon the type of work that a firm delivers to its clients.

What is a System Review and Which Firms Receive Them?

A system review is a study and appraisal by an independent evaluator, known as a peer reviewer, of a CPA firm’s system of quality control to perform accounting and auditing (A&A) work. The quality control system represents the policies and procedures that the CPA firm has designed, and is expected to follow, when performing its work. The peer reviewer’s objective is to determine whether the quality control system is designed to ensure compliance with professional standards and whether the firm is following its system appropriately.

Firms that perform engagements under the Statements on Auditing Standards (SASs), Government Auditing Standards (Yellow Book), or examinations of prospective financial statements under the Statements of Standards for Attestation Engagements (SSAEs) are subject to system reviews.

The scope of the peer review does not encompass other segments of a CPA practice, such as tax services or management advisory services, except to the extent that they are associated with financial statements, such as reviews of tax provisions and accruals contained in financial statements.

What is an Engagement Review and Which Firms Receive Them?

This type of review is for firms that are not required to have a system review.  Unlike system reviews where a firm’s system for quality control policies and procedures is evaluated, an engagement review evaluates the firm’s financial statements and documentation with regard to conformance to AICPA professional standards.  The reviewer does not express an opinion on the firm’s compliance with its own quality control policies and procedures or compliance with AICPA quality control standards. An engagement review provides reviewers with a reasonable basis for expressing limited assurance that:

• The financial statements or information and the related accountant’s report on the accounting, review, and attestation engagements the firm submits for review conform to professional standards.
• The reviewed firm’s documentation conforms with the requirements of professional standards.

Firms that only perform services under Statements on Standards for Accounting and Review Services (SSARS) and/or services under the SSAEs not included in system reviews have engagement reviews.

Back to Top

Schedule

Peer Review Administrative Fees

Annual fees for firms performing auditing, accounting, and attest functions:

Technical Evaluation Fees

A technical evaluation fee is charged when the review is performed (every three years) and is billed separately. 

Peer Review Day Fees

The fees below include the reviewer’s fee, CSCPA participation fee, and a technical review fee of $100 for all engagement reviews.

Peer Review Day Fees

Number of Reports Reviewed    

Back to Top

Revised AICPA Standards for Performing and Reporting on Peer Reviews Effective January 1, 2009

The AICPA has issued revised Standards effective for peer reviews commencing on and after January 1, 2009.  The revised guidance is expected to result in a more efficient and effective peer review process.  Since the revisions are significant, all interested parties, especially peer reviewers, peer reviewed firms (including those responsible for their firm’s quality control functions) and peer review users are encouraged to become familiar with them. 

Revisions to the Standards include more principles-based Standards, and changes to engagements and report reviews.  Also, the reporting process has been reengineered to include a shorter and more concise peer review report, which enhances it clarity, comparability and understandability.  For further details, the revised Standards and related material may be downloaded at www.aicpa.org/members/div/practmon/pr_stds.htm

One of the many changes to the Standards is that the peer review reports were revised to be more concise and understandable, and the report grades were changed to pass, pass with deficiency, and fail. This new reporting model promotes consistency and efficiency. It also improves transparency—in reading the report, the quality of the firm’s practice becomes more transparent. The following chart compares the reporting model under the current versus revised Standards:

Current Standards    Revised Standards
Unmodified – No LOC                           Pass
(Matter – MFC)    (Matter – MFC)
Unmodified – LOC   (Finding – FFC)
(Finding – in LOC)

Modified – LOC   Pass w/Dificiency
(Deficiency – in report)    (Deficiency – in report)
(Finding – in LOC)

Adverse     Fail
(Deficiency – in report)  (Significant deficiency –
   (in report)  
                
The Standards will continue to require preparation of Matters for Further Considerations forms (MFC). The MFC's under the revised Standards will be discussed with the firm being reviewed and will be cleared or developed into a Findings for Further Considerations (FFC) that can be elevated to a deficiency or significant deficiency. In order to retain the ability to educate and inform firms as to the findings, the FFC will allow the firm being reviewed to provide meaningful responses to findings and comments. The determination, as in the past, as to whether the FFC is elevated will depend on considering the nature, causes, pattern, pervasiveness, and relative importance to the quality control system as a whole. Firms will be expected to submit a corrective action plan related to deficiencies and an implementation plan in response to FFC's that have been elevated to significant deficiencies.

Additional changes:

• Merges” the two peer review programs—the National Peer Review Committee (National PRC) will administer the Program at the AICPA for those peer reviews previously performed under the auspices of the CPCAF PRP.

• Creates an independence impairment for internal inspectors, consulting reviewers, and preissuance reviewers intending to perform certain peer reviews. Under Interpretation No. 10 “Independence, Integrity, and Objectivity” of the revised Standards, independence would be considered impaired for purposes of being able to perform a firm’s peer review (whether as a team captain or team member) for anyone also performing an internal inspection, consulting review, quality control document review, preliminary quality control procedures review, or preissuance review for the firm prior to the peer review. An exception is granted if those services were performed in the year immediately following the previous peer review year end.

• Revamps the wording of peer review reports to make them more concise and understandable

• Folds Report Reviews into Engagement Reviews in conjunction with changing the extent of procedures performed in Engagement Reviews on compilation engagements performed under Statements on Standards for Accounting and Review Services.

• Changes to the report:
­ The type of peer review report (System or Engagement) is identified at the top of the report.
­  It is shortened and requires very little tailoring
­  The report contains language that is easier to understand
­  It makes reference to a URL for a “plain English” description of the nature, objectives, scope,   limiitations       of,  and procedures performed on the peer review (rather than this information being detailed in the report or    an attachment).
­ The report enhances the existing peer review report format whereby the report is a stand-alone document that discloses the deficiencies or significant deficiencies that form the basis for the type of report issued.
­ It includes no comments, deficiencies, significant deficiencies, or recommendations when the report has a peer review rating of pass.

• Scope Limitations
­ In the current Standards, scope limitations are addressed in modified reports. In the revised Standards, a scope limitation doesn’t necessarily result in a deficiency. In response, the board reevaluated all the guidance related to scope limitations and matters of noncooperation and made clear distinctions between the two. In addition, the revised Standards reflect that a firm could receive a peer review report with a report grade of pass with scope limitation, pass with deficiency (with a scope limitation), or fail (with scope limitation).

Documentation retention periods have been lengthened to 120 days from 90 days and the FFC forms will be required to be retained until the reviewed firm's next peer review. Changes have been made that affect the submission process, peer reviewers, technical reviewers, and administrative entities.
These changes are outlined in the white paper issued by the AICPA and of course are contained in the revised Standards. You will want to carefully read these documents to gain a full understanding of the many changes that will affect you.  To download  a copy of the white paper go to http://www.aicpa.org/download/centerprp/White_Paper_final_6_23_08.pdf . 

Establishiung and Maintaining a System of Quality control for a CPA Firm's Accounting and Auditing Practice (SQCS No. 7) Effective 1/1/09

On October 10, 2007, the AICPA’s Auditing Standards Board issued Statement on Quality Control Standards No. 7, A Firm’s System of Quality Control, to replace all existing Statements on Quality Control Standards (SQCS).  This SQCS is effective as of January 1, 2009.  The SQCS deals with a firm’s quality control practices in the areas of audits, reviews and compilations, and other attestation engagements, and places an unconditional obligation on a firm to establish a system of quality control.  A system of quality control is designed to provide reasonable assurance that a firm and its personnel comply with professional standards and applicable regulatory and legal requirements, and that the reports issued by the firm or engagement partners are appropriate in the circumstances.

The objectives of the new standard are not really different from previous quality control standards.  The devil, however, is in the details and SQCS No. 7 is no exception.  The new standard expands current standards and provides guidance consistent with International Standards, particularly International Standard on Quality Control (ISQC) 1, Quality Control for Audit, Assurance and Related Services, which was issued by the International Auditing and Assurance Standards Board. 

A brief reminder of current SQCS

Like all professional standards (FASBs, SASs, SSARs, etc.), the Statements on Quality Control Standards apply to all CPAs and their firms.  Just because these standards are tested only in firms having a system peer review does not mean that they do not apply to everyone else. 

Current standards provide a general overview of a system of quality control, establish five elements of quality control, provide guidance for establishing policies and procedures for each of the quality control elements, and discuss techniques to administer a quality control system, such as assignment of responsibilities, communication and documentation of both the design and compliance with the quality control system.

Currently, the five elements of quality control are:

1. Independence, Integrity, and Objectivity
2. Personnel Management
3. Acceptance and Continuance of Clients and Engagements
4. Engagement Performance
5. Monitoring

Policies and procedures are developed for each of the five elements.  The type and number of policies is dependent on the firm’s size, structure, etc.  Policies may be memorialized in a formal document, or they may be informal and communicated to the appropriate parties orally.

How is SQCS No. 7 different?

First and foremost, SQCS No. 7 is far more detailed than current standards.  Right after the introduction and definition of a system of quality control are definitions of several terms such as “accounting and auditing practice”, “engagement documentation” and “engagement team”.  These definitions are consistent with the definitions for these terms throughout other standards.  

Engagement Quality Control Review

One definition, however, stands out.  According to SQCS No. 7, an “engagement quality control review” is “a process designed to provide an objective evaluation, by an individual or individuals who are not members of the engagement team, of the significant judgments the engagement team made and the conclusions they reached in formulating the report”.  This review is often referred to as a concurring review.  The engagement quality control review occurs before the report is issued.  Firms must identify which engagements are to be subject to such a review.  In addition, SQCS No. 7 provides guidance on how such a review should be performed.  Procedures to be performed in an engagement quality control review are as follows:

1. Review of the financial statements and report, and consider whether the report is appropriate under the circumstances.
2. Review of selected working papers relating to significant engagement team judgments and
3. Discuss the engagement with the practitioner-in-charge and 

Obviously, the extent of such a review depends on the complexity of the engagement, and the risk that the report might not be appropriate in the circumstances.  And, of course, the results of an engagement quality control review must be documented, specifically that the firm’s procedures have been performed, the review was completed before the report was issued, and the reviewer is not aware of any unresolved matters.

The new statement also requires firms to establish criteria for the eligibility of engagement quality control reviewers, including technical expertise, objectivity, and the proper authority.  Qualified persons from outside the firm may be contracted when sole practitioners or small firms identify engagement requiring an engagement quality control review.

It should be noted that engagement quality control reviews are not required by the new standard.  SQCS 7 simply states that policies and procedures for such a review should be documented for those firms who have incorporated concurring reviews into their systems of quality control.

Documentation

A firm must document its quality control policies and procedures.  The extent of the documentation is based on the size, structure and nature of the firm’s practice.  

This requirement will be a big change for many small firms, who have policies and procedures, but have not formally documented them.  During peer review, small firms generally complete a questionnaire for their peer reviewer that answers specific questions about policies and procedures.  

Firms may still be able to use this document as a quality control document, as long it is completed by January 1, 2009, periodically reviewed and updated, and given to each employee.  Simply download the appropriate Quality Control Policies and Procedures Questionnaire (http://aicpa.org/members/div/practmon/systemreview.asp) from the AICPA’s website, complete it and give a copy to each member of the firm.  Then, on an annual basis, update the form for any changes.

Samples of more formalized documents can be found in the AICPA practice aid entitled Establishing and Maintaining a System of Quality Control for a CPA Firm’s Accounting and Auditing Practice (Product No. 006636) . It contains sample quality control documents for a firm with multiple offices, a firm with a single office, a sole practitioner and an alternative practice structure. Practitioners Publishing Company (PPC) has updated its QC Manual as well, and introduced a streamlined version for firms that only do compilation and review work.  

A warning to firms preparing to document their quality control system for the first time: be careful to adopt only those policies and procedures that work for your firm.  Adoption of a sample quality control document from the AICPA or PPC without modification can have disastrous results during peer review if the firm does not have the resources to comply with the policies and procedures adopted.

Elements of quality control

The elements of quality control have been expanded as follows:
1. Leadership responsibilities for quality within the firm (“Tone at the Top”);
2. Relevant ethical requirements
3. Acceptance and continuance of client relationships and specific engagements;
4. Human resources (formerly Personnel Management);
5. Engagement performance; and
6. Monitoring

Tone at the top.  The firm’s managing partner (or equivalent) should assume ultimate responsibility for quality control by providing leadership and setting an example that promotes a quality – oriented firm culture. To that end, the firm’s quality control system should include policies to:
• Assign management responsibilities so that commercial considerations do not override the quality of work performed
• Design its policies and procedures addressing performance evaluation, compensation, and promotion (including incentive systems) with regard to its personnel, to demonstrate the firm’s overarching commitment to objectives of the system of quality control.
• Devote sufficient and appropriate resources for the development, communication, and support of its quality control policies and procedures.

Peer review has been moving in this direction for several years.  The Center for Public Company Audit Firms Peer Review Program established a managing partner questionnaire several years ago, and the AICPA Peer Review Program adopted a similar questionnaire as well.  A firm’s managing partner is interviewed and asked to comment on his or her understanding of the firm’s significant quality control risks, new clients or industries with significant risk, the firm’s top 3 clients in terms of fees, how difficult client issues are resolved and partner advancement and compensation issues.

Relevant Ethical Requirements.  SQCS No. 7 provides more detailed guidance on independence and now requires a written confirmation of compliance with independence requirements from all firm personnel at least annually.  In a nod to our continuing reliance on computer technology, the new standard allows the confirmation to be in paper or electronic format.

Client acceptance.  Again, the new SQCS provides additional guidance on client acceptance and continuance issues.  These additional details are requirements for policies that were always considered “best practices” and many firms had adopted them anyway, but the new standard leaves no doubt that these “best practices” are now requirements.  The only new matter contemplated in this element is that if firm personnel identify issues relating to acceptance or continuance and the firm ultimately decides to accept or continue the client relationship, the firm must document how such issues were resolved.

Human resources.  Except for providing specific policies, which are already a part of most firms’ QC systems, this element did not change.

Engagement performance.  The new SQCS provides more detailed guidance on engagement supervision and review, including a requirement that more experienced team members review the work of those with less experience.  In addition, an entire section has been added concerning retention of engagement documentation.  This section discusses establishing policies and procedures to maintain the confidentiality, safe custody, integrity, accessibility and retrievability of engagement documentation.  These policies and procedures are consistent with the requirements of SAS 103.  Specific guidance is also given regarding consultation policies and procedures.  And, finally, there is a requirement that a report cannot be issued until any differences of opinion have been resolved.

Monitoring.  While the new standard still allows individuals to review their own work, it clearly discourages firms from doing so. And, like all the other elements, much additional guidance on how to conduct monitoring has been added.  A section regarding complaints and allegations has also been added to the monitoring section.  This would include policies and procedures to handle complaints and allegations the work was not performed in accordance with standards and or regulatory and legal requirements that might come from outsiders or from firm personnel.

Firm personnel, especially those individuals in charge of quality control, should carefully read the new standard and determine what changes, if any, are needed to the firm’s policies and procedures.  Then each firm should write (or amend) their quality control document to incorporate the requirements of SQCS 7.  Use of practice aids from the AICPA or PPC are encouraged, but remember to use them judicially; only adopt those policies and procedures that the firm is able to implement.

Marcia J. Hein, CPA is a member of the Colorado Society of CPAs Peer Review Board.  This article originally was published in the September/October issue of the California CPA magazine.  It is reprinted with permission
 

Back to Top

 Peer Review Days

The Peer Review Board has scheduled four Peer Review Days for 2009. 

If your firm is eligible to have a Report or Engagement review (performing fewer than five reviews) and agrees to the following criteria, it will qualify for the Peer Review Day Program:

• You perform fewer than five reviews. 
• You are a sole practitioner or sole owner of an LLC or a PC performing compilations without disclosure, compilations with disclosure, and five or fewer reviews.
• The firm’s completed scheduling form is returned to Peer Review 60 days prior to peer review due date.
• The firm provides all review information requested by Peer Review staff approximately four to six weeks prior to the review day, and all fees are paid in advance.
• You will be available for a reviewer’s questions on the day your firm is scheduled for review.

The CSCPA will hold four Peer Review Days during 2009: May 22, July 23, September 24, and November 19, 2009. The reviews will be performed as Committee Appointed Reviews (CARTS). Qualified reviewers will be selected and assigned to firms based on matching client industry and other information provided by the firm. Peer Review staff will schedule the reviews, select and receive reports from the firms, and assign the reviewers. Staff also will be responsible for all clerical aspects of these reviews and provide necessary checklists and materials to the reviewers.  

The fees below include the reviewer’s fee, CSCPA participation fee, and a technical review fee of $100for Engagement Reviews. 

Peer Review Day Fees

Number of Reports Reviewed    

1 Compilation Without Disclosure    $325
2 Compilations Without Disclosure $445
1 Compilation With Disclosures $445
1 Compilation Without Disclosure and 1 Compilation With Disclosure $565
1 Review $445
1 Review and 1 Compilation Without Disclosure $565
1 Review and 1 Compilation With Disclosure $685
1 Review, 1 Compilation With Disclosure and 1 Compilation Without Disclosure $805

There is limited space available in each session, so if you wish to participate in the Peer Review Day Program, e-mail Jill Turner or call her at (303) 741-8605 or (800) 523-9082, ext. 105 for information.

Back to Top

 Becoming A Peer Reviewer

What are the Benefits of Being a Peer Reviewer?

When you become a peer reviewer, you:

• Help firms achieve their A&A practice goals and enhance the quality of their A&A practices
• Identify best practices of other firms, which can be applied to other peer review clients and to your own firm
• Gain broader practice knowledge through the peer review process, which will help sharpen your skills and reinforce your strengths
• Create an opportunity to expand on your current services
• Often receive referrals for additional consulting services as a result of performing peer reviews
• Enhance the efficacy of the profession’s self-regulatory efforts and contribute to the quality of our profession 

What are the Qualifications Necessary to Become a Reviewer?

To qualify as a peer reviewer, you must:

• Be a member of the AICPA in good standing
• Be active in public practice at a supervisory level in the accounting or auditing function
• Have five years of public accounting experience

In addition, if you are a partner in your firm, you are qualified to be a team captain. 

For more information, visit www.aicpa.org/members/div/practmon/become_peer_reviewer.htm or e-mail PeerReviewupdates@aicpa.org.

How do I Become a Peer Reviewer?

To become a peer reviewer:

• Meet all the reviewer requirements. A full list of requirements can be downloaded at www.aicpa.org/download/members/div/practmon/Reviewer_Qualifications.pdf.
• Complete the AICPA two-day introductory reviewer training course, “How to Conduct a Review Under the AICPA Practice-Monitoring Program.” Check the AICPA course listings at www.aicpa.org/members/div/practmon/Reviewer_Training_Courses.htm or e-mail Jill Turner or call her at (303) 741-8605 or (800) 523-9082, ext. 105 to obtain information about the introductory course.   Please note that 16 hours of CPE credit is recommended for taking this course.
• Complete a peer review resume form. It can be completed online at peerreview.aicpaservices.org/. Once you enter your resume, you automatically will be listed in the online searchable database.  Please note that you will need your AICPA login to access the form. 
• Undertake the business development activities suggested in the Peer Review Welcome materials sent after you attend the "how-to" course.

Gain Expertise and Exposure as a Peer Reviewer

Not only will you obtain valuable knowledge, but your experience will also introduce you to new opportunities for both yourself and your firm. 

The Benefits of Peer Review:

• Be seen as an expert by your peers
• Learn first hand about the best practices of other accounting firms – how to apply them in your firm and improve client services
• Develop an additional profit center for your firm
• Help firms achieve their A&A practice goals and the quality of their A&A practices
• Often receive referrals for additional consulting services as a result of performing peer reviews
• Enhance the efficacy of the profession’s self-regulatory efforts and contribute to the quality of the profession

To qualify as a peer reviewer, you need to:

• Be a member of the AICPA and CSCPA in good standing
• Be active in public practice at a supervisory level in the accounting and auditing function
• Have 5 years of public accounting experience
• In addition, if you are a partner in your firm, you are qualified to be a team captain.

 Back to Top

CPE Classes for Peer Reviewers

Whether you are just beginning your Peer Review status or need the advanced training course to maintain your reviewer status, the CSCPA has the course for you in 2008: 

Date to be determined - CSCPA Training Center – 16 hours CPE credit
How to Conduct a Review Under the AICPA Practice-Monitoring Program (this class is required for all beginning peer reviewers)

May 2009 – CSCPA Training Center – 8 hours CPE credit
Advanced Course:  Overview of the AICPA Peer Review Program Standards
 

If you have any questions about Peer Review, please contact Jill Turner at (303) 741-8605 or (800) 523-8092.

Enhance your skills, your market positioning, your practice and our profession.  Become a peer reviewer today!!

Back to Top

Meet the Peer Review Board

We are pleased to introduce our Peer Review Board:

Ray Russell, Chair

Peggy Jennings - Vice Chair

Members
Joe Adams
Julie Affleck
Don Gruenler
Marcia Hein
Bob Hoerr
Bill Lajoie

Keith May
Jill Rickards
Mike Schulz
Alan Terry
Randy Watson

 Peer Review Board Meetings will be held on the following dates:

Reviewers must assess "peer review risk" and use a risk‑based approach in the selection of engagements and offices for review. Audit risk is assessed in audit planning, and "peer review risk" is assessed in planning a system review. Peer review risk is the risk that the reviewer (and the peer review team) will:

• Fail to identify significant weaknesses in the reviewed firm's system of quality control or the degree of compliance therewith
• Issue an inappropriate report on the reviewed firm's system of quality control for its accounting and auditing practice or the firm's compliance with that system or both
• Reach an inappropriate conclusion about whether or not to issue a letter of comments and/or about the findings to be included in or excluded from the letter of comments

The assessed levels of risk are the key considerations in deciding the number and types of engagements to review and, where necessary, offices to visit. Through the assessment of risk, the reviewer determines the coverage of the firm's accounting and auditing practice that will result in an acceptably low peer review risk. Engagements selected should provide a reasonable cross‑section of the firm's accounting and auditing practice, with a greater emphasis on those engagements in the practice with higher assessed levels of peer review risk.

Reviewers must document, as part of the Summary Review Memorandum, the risk assessment of the firm's accounting and auditing practice and its system of quality control, the number of offices and engagements selected for review, and the basis for that selection in relation to the risk assessment. To effectively assess risk of the firm's accounting and auditing practice and its quality control policies, risk assessment documented action should not only address the engagements selected and the reasoning behind that selection but also the environment of the firm and its system of quality controls. Factors that should be considered in assessing risk include the following: 

• The relationship of the firm's audit hours to total accounting and auditing hours
• The engagement size, relative to the firm's practice as a whole
• Initial engagements
• The industry in which the firm's clients operate, especially the firm's industry concentrations
• The results of the prior peer review
• Owners' CPE policies
• Owners' monitoring policies
• Maintenance of the firm's professional library
• Risk level of the engagements performed (ERISA, HUD, etc.)
• Any major changes in the firm since the prior peer review
• Engagements selected and the reasoning behind the selection 

Although standards do not require any specific format for documenting risk assessment, the documentation should include enough information to allow the report acceptance body (RAB) to review the risk levels to determine if the peer review standards were appropriately applied. The documentation should include the assessment of inherent risk, control risk, and detection risk as they pertain to the firm’s accounting and auditing practice, its quality control system, the number of offices and engagements to be selected and the basis for that selection in relation to risk assessment. Below are some examples of risk assessment documentation.

Example 1

Inherent risk was assessed at moderate to high for audit and review engagements since a) sole practitioner with no professional staff and with less perceived need for accounting and auditing network and b) two of the 12 engagements are in unique industries. Low risk on compilation engagements, mostly retail trade and uncomplicated engagements. Control risk was assessed at moderate due to the firm's system, which uses PPC, but the system can be compromised by ability or lack of compliance by sole practitioner. Based on the risk assessment above, selected two of 10 audits (one in a unique industry), one of two reviews, and one of 20 full disclosure compilation engagements. 

Example 2

Inherent risk was assessed at medium to low because of the firm's industry concentrations in its client base and the lack of recent pronouncements issued in these industries, and because there is no professional staff other than owner. Control risk was assessed at low to medium due to the quality control policies and procedures in place and the firm's current maintenance of its library. Based on the risk assessment above, I selected an appropriate number of engagements and obtained a cross‑section of the firm's engagements.

Example 3

Firm works in several specialized industries, however clients tend to be small and non‑complex. No significant new clients since last review and no new industries. Inherent risk assessed as moderate. Based on the results of prior peer reviews, the lack of turnover of the firm's employees and preliminary review of the firm's system of quality control, control risk is assessed as moderate. Based on risk assessments, selected audit and review from two industry concentrations. Balance of selection for coverage of levels of service. 

Example 4

The inherent and control risk is considered low to moderate. This is a single office firm, run by two partners, both of whom are responsible for accounting and auditing engagements. All of the firm's audits are HUD, which are high‑risk engagements. The firm's professional library is comprehensive and current and the partners perform pre‑ and post‑issuance reviews on all engagements. In addition, the prior peer review did not have any significant findings. Based on risk assessments, selected HUD audits and balance of selection for coverage of levels of service.

Back to Top

 

---

 

 

 

 

Directory of Peer Reviewers

The AICPA Peer Review Program has established specific standards for performing and reporting on reviews. The specific qualifications are set forth in the standards for performing and reporting on reviews. The firms listed are not the only firms that may be qualified to conduct reviews. They have elected to be listed in the directory.

If you have questions about peer reviews in Colorado, e-mail Jill Turner or call her at (303) 741-8605 or (800) 523-9082, ext. 105.

To View Client Categories

Anderson & Whitney, PC
AICPA Firm Number 10001437
5801 W. 11th St.
Suite 300
Greeley, CO 80634-4813
Fax: (970) 352-1855
Number of Professionals: 11-19

Contact:  Alan Holmberg 
(970) 352-7990
AICPA Member Number 1139592
alan@awhitney.com

Client Categories: 2, 3, 5, 7, 9, 10, 11, 13, 18, 110, 125, 135, 140, 155, 180, 186, 217, 222, 230, 260, 268, 320, 325, 335, 380, 385, 395, 400, 410, 420

Blair and Associates, PC
Collice P. Blair Jr., CPA, CFE
AICPA Firm Number  10095329
105 S.E. Frontier Dr.
Suite A
Cedaredge, CO  81413-4020
Fax:  (970) 856-2122
Number of Professionals: Sole Practitioner

Contact:  Pete Blair 
(970) 856-7550
AICPA Member Number   1114856
pete.blair@kaycee.net

Client Categories: 2, 3, 5, 9, 13, 110, 165, 175, 222, 260, 268, 308, 325, 420

Mary Brenes, CPA
AICPA Firm Number  10153116
P. O. Box 4655
Grand Junction, CO 81502
Fax:  (970) 242-1698
Number of Professionals: Sole Practitioner

Contact:  Mary Brenes 
(970) 242-1698
AICPA Member  Number  45878
brenescpa@gvii.net

Client Categories: 2, 5, 9, 13, 155, 186, 222, 260, 325, 420

Eide Bailly LLP
AICPA Firm Number 10018920
5299 DTC Blvd.
Suite 1000
Greenwood Village, CO  80111
Fax: (303) 770-7581
Number of Professionals: 100+
Firm Also Enrolled in CPCAF

Contact: Peggy E. Jennings
(303) 770-5700
AIPCA Member Number  10867828
ptopel@ghbcpa.com

Client Categories: 1, 2, 3, 9, 10, 11, 110, 155, 165, 180, 185, 210, 260, 268, 380, 385, 390, 395, 400, 405, 410

Haynie and Company  
AICPA Firm No. 10110842

1221 W. Mineral Ave.
Suite 202         
Littleton, CO  80231                   
Fax:  (303) 795-3356
Number of Professionals: 50-99
Firm also enrolled in CPCAF

Contact:  Raymond Russell
(303) 734-4800
AICPA Member Number  739878
rayr@hayniecpas.com

Client Categories: 1, 2, 3, 4, 5, 9, 10, 13, 14, 135, 155, 165, 216, 222, 230, 250, 260, 320, 325, 380, 385

Haynie and Company 

AICPA Firm No.     1110466           

1221 W Mineral Ave Ste #201         

Littleton, CO  80120                   

Fax Number:  (303) 795-3356

No. of Professionals:           50-99

Firm also enrolled in CPCAF

Contact: Dick Mason (303) 734-4800

AICPA Member No. 546535

e-mail  dickm@hayniecpas.com

Client Categories:1, 2, 3, 10, 165, 185, 260, 268, 325, 380, 385

Marcia J. Hein, CPA
AICPA Firm Number:  10155807
807 Marble Dr.
Fort Collins, CO  80526
Fax:  (970) 282-8229
Number of Professionals: Sole Practitioner

Contact: Marcia J. Hein  
(970) 282-8229
AICPA Member Number  1141590
Marcia@mjh-cpa.com

Client Categories: 2, 9, 10, 110, 165, 260, 380, 385, 390, 395

Hiratsuka & Schmidt, LLP
AICPA Firm Number: 10134883
1401 17th St.
Suite 400
Denver, CO  80202
Fax:  (303) 295-6866
Number of Professionals: 6-10

Contact:  Don Gruenler 
(303) 295-7077
AICPA Member Number  1032173
dong@cpa-hs.com
 

Client Categories: 5, 13, 186, 222, 260, 320, 325

Robert L. Hoerr, PC
AICPA Firm Number  380989
950 Wadsworth Blvd.
Suite 204
Lakewood, CO 80214
Fax:  (303) 232-9452
Number of Professionals: Sole Practitioner

Contact:  Robert Hoerr
(303) 239-8706
AICPA Member Number  380989
rlhoerr@msn.com

Client Categories: 2, 9, 155, 165, 260, 325

William G. Lajoie, P.C.

AICPA Firm No. 480615

6601 S. University Blvd.

Centennial, CO  80121

Fax Number: (303) 795-1876

No. of Professionals:           Sole Practitioner

Contact:  William (Bill) Lajoie

(303) 798-4250

AICPA Member No.  480615

e-mail WGL1211@aol.com

Client Categories:

2, 9, 10, 11, 155, 165, 180, 260, 380, 385, 390, 400

Marc, James & Associates, PC
AICPA Firm Number  1163201
1745 Shea Center Dr.
Suite 400
Highlands Ranch, CO  80129
Fax: (206) 888-2716
Number of Professionals: Sole Practitioner

Contact:  Gregory Viergutz
(720) 344-4938
AICPA Member Number   1163201
greg@marcjamescpa.com

Client Categories: 2, 3, 5, 9, 10, 11, 18, 125, 155, 165, 250, 260, 325, 380, 385, 400

Dennis L. Oberhelman, CPA
AICPA Firm Number 1019733
3819 St. Vrain St.
Suite B
Evans, CO  80620
Fax:  (970) 506-9432
Number of Professionals: Sole Practitioner

Contact:  Dennis Oberhelman 
(970) 506-9431
AICPA Member Number 1019733
doberhelman@hotmail.com

Client Categories: 2, 5, 9, 222, 260, 325, 420

Richey, May & Co., LLP
AICPA Firm Number 10084120
9605 S. Kingston Ct.
Suite 200
Englewood, CO 80112
Fax:  (303) 721-6232
Number of Professionals: 11-19
Firm Also Enrolled with PCAOB

Contact:  Keith May
(303) 721-6131
AICPA Member Number 1128734
keith@richeymay.com

Client Categories:  1, 2, 3, 5, 9, 10, 11, 13, ,18, 125, 135, 155, 165, 180, 185, 186, 190, 222, 230, 250, 260, 265, 268, 270, 325, 380, 385, 400, 420

Rickards Long & Rulon, LLP
AICPA Firm Number 1053120
301 E. Olive St.
Fort Collins, CO 80524
Fax:  (970) 484-1992
Number of Professionals: 11-19

Contact:  Jill Rickards
(970) 493-6869
AICPA Member Number 1053120
jrickards@rlrcpas.com

Client Categories: 2, 3, 5, 110, 155, 165, 222, 260, 268, 270, 305

Sapp and Company, LLC
AICPA Firm Number 2080325
2855 S. Devinney Ct.
Suite 202
P.O. Box 280956
Lakewood, CO  80228-0956
Fax:  (303) 763-5521
Number of Professionals: 2-5

Contact:  Michael Sapp 
(303)-985-9674
AICPA Member Number 13370
msappcpa@earthlink.net

Client Categories: 2, 3, 5, 7, 9, 11, 13, 18, 110, 125, 126, 155, 165, 175, 186, 190, 200, 205, 217, 222, 260, 268, 300, 310, 320, 325, 335, 420 

Schulz & Company, PC
AICPA Firm Number 10099893
15200 E. Girard Ave.
Suite 4900
Aurora, CO 80014
Fax:  (303) 690-9110
Number of Professionals: 2-5

Contact:  Michael Schulz
(303) 690-7275
AICPA Member Number 763831
mike@schulzcocpa.com

Client Categories: 2, 3, 5, 9, 10, 13, 18, 110, 125, 155, 165, 180, 185, 190, 205, 222, 260, 268, 385, 390, 400

Terry & Co., PC
AICPA Firm Number 10093530
303 E. 17th Ave.
Suite 805
Denver, CO 80203
Fax: (303) 831-4948
Number of Professionals: 11-19

Contact:  Alan Terry
(303)-831-1904
AICPA Member Number 852856
aterry@terrystephensonpc.com

Client Categories: 2, 3, 5, 9, 10, 13, 120, 155, 222, 260, 268, 325, 380, 385, 395, 400, 410, 420

Yanari, Watson, McGaughey, PC
AICPA Firm Number 10091246
9250 E. Costilla Ave.
Suite 450
Englewood, CO 80112
Fax:  (303) 792-5153
Number of Professionals: 6-10
Firm Also Enrolled in CPCAF

Contact:  Randy Watson
(303) 792-3020
AICPA Member Number 1003455
randy@ywmcpa.com

Client Categories: 2, 9, 10, 110, 120, 155, 160, 165, 190, 260, 268, 380, 385, 390, 395

Yanari, Watson, McGaughey, P.C.

AICPA Firm No.  10091246

9250 E. Costilla Ave., #450

Englewood, CO 80112

Fax Number:  (303) 792-5153

No. Of Professionals:          11-19

Firm Also Enrolled in CPCAF

 Contact:  Troy Coon 303-792-3020

AICPA Member No. 1700797

e-mail  troy@ywmcpa.com

Client Categories:

2, 3, 10, 11, 180, 185, 190, 260, 268, 380, 385, 390, 395, 400, 405, 410

Back to Top

Engagement Selection Based on Risk Assessment for System Reviews

May 11-12, 2009 RABs & Board (last meeting of 2008 PRB year)

July 13-14, 2009 RABs only

Aug. 31-Sept. 1, 2009 RABs and Board

October 26-27, 2009 RABs only

Dec. 14-15, 2009 RABs & Board

Jan. 25-26, 2010 RABs only

March 2010 – if needed

Back to Top