GAQC Alert No. 334

GAQC Alert
OMB Extends Procurement Grace Period; New Clarified Attestation Standards Now Effective
May 17, 2017
GAQC Alert #334
In This Alert
Procurement Grace Period Extension
AICPA Attest Clarity Standards
Now Available!
The 2017 AICPA Audit Guide, Government Auditing Standards and Single Audits, has been issued. This guide is a key resource for performing Yellow Book audits and single audits. Learn more!
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Dear Center Members
This GAQC Alert informs you about an announcement by the U.S. Office of Management and Budget (OMB) that further extends the procurement grace period for recipients of federal awards. It also provides an important reminder about changes to the AICPA attestation standards (Attest Clarity standards) that became effective on May 1, 2017. After reading this GAQC Alert you will:
  Learn about an additional one-year grace period being provided by OMB for the implementation of the procurement requirements in the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance); and
  Be reminded of the recently effective AICPA Attest Clarity standards; specific types of governmental engagements to which those standards apply; and the availability of an updated governmental pension-specific report illustration.
Procurement Grace Period Extension
On May 17, 2017, OMB issued a correcting amendment to the Uniform Guidance in the Federal Register to allow a grace period of one additional fiscal year for non-federal entities to implement changes to their procurement policies and procedures in accordance with the procurement standards in 2 CFR 200.317 through 200.326 of the Uniform Guidance. Therefore, the implementation date for the procurement standards will start for fiscal years beginning on or after December 26, 2017, for those entities choosing to take advantage of the extension.

In making the GAQC aware of this development, OMB staff communicated that this will be the final grace period for non-federal entities who have chosen not to implement the Uniform Guidance procurement standards and that entities should begin preparing for implementation prior to the extended implementation date. For example, an entity with a fiscal year ending December 31, 2018, should be ready to implement the Uniform Guidance procurement standards at the beginning of that fiscal year (i.e., January 1, 2018). Non-federal entities and their auditors are also reminded about the provisions in 2 CFR 200.110 which require non-federal entities to document their decision to choose to use the previous procurement standards during the extension period.

The GAQC will further discuss this development in our upcoming Web event, 2017 OMB Compliance Supplement and Single Audit Update, to be held on June 8, 2017, from 1:00 PM – 3:00 PM (Eastern). For more information about this event, see GAQC Alert #333.
AICPA Attest Clarity Standards
Attestation engagements are relatively common in the governmental environment and include examinations, reviews, and agreed-upon procedures engagements. If your practice performs these types of engagements you should ensure that those participating in the engagements are aware of recent changes. In 2016, the AICPA Auditing Standards Board completed its project to clarify the AICPA's attestation standards with the issuance of Statement on Standards for Attestation Engagements (SSAE) No. 18, Attestation Standards: Clarification and Recodification. SSAE No. 18 is effective for practitioner's reports dated on or after May 1, 2017. Thus, any engagements with reports issued on or after that date should be performed under the Attest Clarity standards.

In addition to the restructuring and clarification of the standards, there were other changes made to the standards that practitioners should be aware of which changed certain requirements and procedures, as well as modified the reporting structure. See the "AICPA Resources" section below for how to learn more about the detailed changes to the standards.

Attestation Examinations Relevant to Auditing Governmental Pension Plans. Auditors of state and local governments with governmental pension plans should be aware that there are two types of attestation examination engagements relating to pensions specifically discussed in the AICPA Audit & Accounting Guide, State and Local Governments (SLG Guide) as follows:

Single-Employer or Cost-Sharing Multiple Employer Plans – Census Data Testing at Employers. The measurement of certain financial statement elements of single-employer and cost-sharing plans depends on the completeness and accuracy of census data. This includes testing census data at employers. As discussed in chapter 13 of the SLG Guide, if the plan auditor cannot or does not perform census data testing at each employer selected for testing, such census data could be tested by the employer's auditor through an attestation examination engagement. Members should be aware that the GAQC has posted a relevant illustrative practitioner's examination report to the GAQC Web site to update the illustration that appears in chapter 13 of the 2016 SLG Guide for the new Attest Clarity standards. Access the illustrative report. Upon its issuance, the 2017 SLG Guide will include this updated report illustration.

Agent Plans – Reporting for Participating Employers. To assist employers participating in agent pension plans, certain information is required from the plan (and opined on by the auditor). The employer requires sufficient appropriate audit evidence over, among other things, the completeness and accuracy of census data maintained by the plan. One option the plan may employ to provide such evidence is to have the plan auditor perform an examination engagement over selected management assertions related to census data maintained by the plan (as discussed in chapter 13 of the SLG Guide).

Employer auditors and plan auditors, whether performing the above described attestation engagements or relying upon them, should take special note of the May 1, 2017, effective date of the Attest Clarity standards and be sure that attestation reporting issued after that date is prepared in accordance with the updated standards.

Attestation Engagements Required by Federal, State, or Local Agencies. Sometimes governmental agencies require entities that participate in federal or state programs to undergo examination-level attestation engagements. Additionally, agreed-upon procedures engagements are frequently used to satisfy the requirements of regulatory bodies, state agencies, or federal award pass-through entities.

Practitioners are reminded to carefully review the requirements of these engagements prior to acceptance to determine if the procedures to be performed and reports to be issued are appropriate under the new Attest Clarity standards. If a governmental entity that requires such an engagement has not yet updated its requirements to reflect the new Attest Clarity standards, practitioners should comply with the most current standards and not the outdated or conflicting governmental attestation guidance.

The GAQC is working to educate federal agencies about the new Attest Clarity standards and the need to update federal guidance that covers attestation engagements. We also encourage members to do the same with agencies at the state and local level. Please send an e-mail to if the GAQC can be of further assistance with this educational process.

AICPA Resources. The Financial Reporting Center – Attest Clarity section of the AICPA Web site includes a number of resources on the Attest Clarity standards including a brief video providing an overview of SSAE No. 18; a Journal of Accountancy article, and an article that summarizes the Attest Clarity project.
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