CPA Firms

    Peer Reviews: System Review vs. Engagement Review 


    Effective for Peer Reviews Commencing after April 1, 2014.

    We’ve developed this page to help you understand what type of peer review your firm should undergo and the types of engagements your firm must specify for system reviews via questions 18 and 19 on the Information for Scheduling Reviews Form. Engagements covered in the scope of the Peer Review Program are those included in the firm's accounting and auditing practice that are not subject to PCAOB permanent inspection. See Interpretation 6-9 of the Peer Review Standards, Engagements Subject to PCAOB Inspection, for more information.

     

    There are two types of reviews; system and engagement.


    System Review – if your firm performs any of the services mentioned below as its highest level of service, your firm should have a System Review.


    Engagements under the Statements on Auditing Standards (SASs) or Government Auditing Standards (GAS),

    Examinations under the Statements on Standards for Attestation Engagements (SSAEs), or Engagements under PCAOB standards.

     

    Engagement Review – If your firm performs either of the types of services listed below as its highest level of service, your firm should have an Engagement Review.

     

    Services under Statements on Standards for Accounting and Review Services (SSARSs) or

    Services under the SSAEs not listed above in System Reviews.

     

     

    If you still have questions about the type of review your firm should undergo, please review the chart below: 

    If a Firm Performs These Types of

    Engagements as Its Highest Level of Service,

    the Firm Would be Required to Have:

    System Review

    Engagement Review

    Statements on Auditing Standards (SAS)

     

     

    Engagements

    X

     

    Government Auditing Standards (GAS)

     

     

    Financial Audits

    X

     

              Attestation Engagements (Examination, Review, or 
              Agreed-upon procedures under GAS)

    X

     
            Performance Audits

    X

     

    Statements on Standards for Attestation Engagements (SSAEs)

     

     

    Examinations performed under AT section 101, Attest Engagements (AICPA, Professional Standards)

    X

     

    Reviews performed under AT section 101

     

    X

    Agreed-upon procedures performed under AT section 201, Agreed-Upon Procedures Engagements (AICPA, Professional Standards)

     

    X

    Examinations of prospective financial statements performed under AT section 301, Financial Forecasts and Projections (AICPA, Professional Standards)

    X

     

    Compilations of prospective financial statements and application of agreed-upon procedures to prospective financial statements performed under AT section 301

     

    X

    Examinations performed under AT section 401, Reporting on Pro Forma Financial Information (AICPA, Professional Standards)

    X

     

    Reviews performed under AT section 401

     

    X

              Examinations performed under AT section 501, An 
              Examination of an Entity’s Internal Control Over
              Financial Reporting That Is Integrated With an Audit of
             Its Financial  Statements
    (AICPA, Professional
             Standards
    )

     

    X

     

    Examinations performed under AT section 601, Compliance Attestation (AICPA, Professional Standards)

    X

     

    Agreed-upon procedures performed under AT section 601

     

    X

    Examinations performed under AT section 701, Management’s Discussion and Analysis (AICPA, Professional Standards)

    X

     

    Reviews performed under AT section 701

     

    X

    Examinations performed under AT section 801, Reporting on Controls at a Service Organization (AICPA, Professional Standards)

    X

     

    Public Company Accounting Oversight

     Board (PCAOB) Standards

     

     

    Audits of non-SEC issuers

    X

     

           Attestation of non-SEC issuers

    X

     

    Statements on Standards for Accounting and Review Services (SSARS)

     

     

    Reviews of financial services

     

    X

    Compilations of financial statements with disclosures

     

    X

    Compilations of financial statements without disclosures

     

    X

    Compilations performed when the compiled financial statements are not expected to be used by a third party (management use only), when no compilation report Is issued[1]

     

    X


    If you are uncertain about how to classify any engagements, you may consider consulting the AICPA Professional Standards, your administering entity, or the AICPA peer review technical staff via prptechnical@aicpa.org or 919.402.4502 and select option 3.


    [1] Refer to Interpretations 6-1 to 6-6.

     

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