EBP audits: Time to implement SAS 136 (AU-C 703)
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EBP audits: Time to implement SAS 136 (AU-C 703)

Apr 19, 2022 · 287 KB Download

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Auditors will be following Statement on Auditing Standards (SAS) 136, Forming an Opinion and Reporting on Financial Statements of Employee Benefit Plans Subject to ERISA, to perform and report on employee benefit plan (EBP) financial statement audits. SAS 136, as amended, is codified in AU-C 703, Forming an Opinion and Reporting on Financial Statements of Employee Benefit Plans Subject to ERISA, and is effective for audits of financial statements for periods ending on or after December 15, 2021. Early adoption was permitted but surveys indicate that only about 10% of firms did early adopt. SAS 136 includes new requirements in all phases of an audit of Employee Retirement Income Security Act of 1974 (ERISA) plan financial statements, including engagement acceptance, risk assessment and response, communication with those charged with governance, performance procedures, and reporting. The extent of change for a practitioner will depend on how consistent their prior procedures were with the changes in AU-C 703. However, at a minimum, all practitioners will need to revise audit opinions, engagement letters, representation letters, and governance communication letters.

Download the CPEA report: EBP – time to implement SAS 136 (AU-C 703)

File name: CPEA April 2022 report – EBP audits – Time to implement SAS 136.pdf

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