SAS Addresses Several Auditing Standards

The ASB issued Statement on Auditing Standards no. 93 in November (see Official Releases, page 116). Titled Omnibus Statement on Auditing Standards—2000, it discusses the following changes to three existing SASs:

Withdrawal of SAS no. 75, Engagements to Apply Agreed-Upon Procedures to Specified Elements, Accounts, or Items of a Financial Statement. Since 1975 the guidance for performing agreed-upon procedures engagements has resided in two places within the AICPA’s professional literature: the attestation standards and SAS no. 75. The ASB originally issued SAS no. 75 because a written assertion—until recently a condition for engagement performance under the attestation standards—was not necessary in engagements to apply agreed-upon procedures to specified elements, accounts or items of a financial statement.

Since then, the ASB approved issuance of SSAE no. 10, Attestation Standards: Revision and Recodification, which, among other things, removes the requirement for a written assertion for performing attestation engagements including agreed-upon procedures engagements. Therefore, SAS no. 75 is no longer necessary, and the ASB has withdrawn it as well as the related auditing interpretation.

The guidance in SSAE no. 10 relating to agreed-upon procedures engagements is effective when the subject matter or assertion is as of, or for a period ending on or after, June 1, 2001. Earlier application is permitted. The withdrawal of SAS no. 75 is concurrent with the effective date of SSAE no. 10.

Amendment to SAS no. 58, Reports on Audited Financial Statements. Due to the increasing availability on the Internet of audited financial statements, users need to know which jurisdiction’s principles or standards a company observed when it prepared those statements or had them audited.

The amendment to SAS no. 58 therefore specifies that the auditor’s report should indicate which country’s accounting principles and auditing standards were used to prepare the financial statements and audit them.

This amendment is effective for reports that are issued or reissued on or after June 30, 2001. Earlier application is permitted.

Amendment to SAS no. 84, Communications Between Predecessor and Successor Auditors. This SAS did not specifically address situations in which an auditor is engaged to perform a first-year audit but does not complete the audit. The amendment therefore clarifies SAS no. 84 to include within its definition of “predecessor auditor” any auditor who is engaged to perform an audit but does not complete it.

This amendment is effective for audits of financial statements for periods ending on or after June 30, 2001. Earlier application is permitted.