September 2025
Greetings,
As we step into fall (wha-aat! summer is over?!?!?), this month’s newsletter shifts the spotlight from auditing to accounting standards, a reminder that these requirements apply equally to both audit and review engagements. Several important updates have recently been issued, and staying up-to-date with these changes is crucial for delivering high-quality engagements and maintaining client confidence. Beyond the technical, we still focus on practice management topics and the continuing emergence of AI tools. Read on…
Common Control Business Combinations (ASPE 3840)
ASPE 3840 outlines the requirements for accounting for related party transactions (note that related party transactions involving financial instruments are addressed in ASPE 3856). Final narrow-scope amendments to Section 3840 (Related Party Transactions) have been approved and are now in the Handbook. These amendments clarify the accounting for business combinations under common control, in particular, whether comparative figures must be restated when using carrying values prospectively. The amendments simplify the accounting for these transactions. The changes are effective for fiscal years beginning on or after January 1, 2025, so the upcoming December 2025 year ends. Check out the requirements in the standard by logging into Knotia.
AcG-20 Customer’s Accounting for Cloud Computing Arrangements
Effective for fiscal years beginning on or after January 1, 2024, AcG-20 provides long-awaited guidance on how to account for costs related to cloud computing arrangements, such as Software as a Service (SaaS). The guideline requires entities to assess whether components of the arrangement are separable and provides an optional simplification approach that allows certain implementation costs to be expensed immediately. Alternatively, entities may capitalize eligible costs in accordance with Section 3064. AcG-20 also introduces new disclosure requirements regarding the accounting policy applied and its financial impact. Transition is retrospective, with some relief provisions. This change is especially relevant for organizations implementing or upgrading cloud-based systems.
AcG-21 Accounting for life insurance contracts with a CSV
The AcSB has approved Accounting Guideline 21 (AcG-21) to fill the existing gap under ASPE in how life insurance contracts with a cash surrender value (CSV) should be accounted for. Under AcG-21, an entity that is the owner and beneficiary of a life insurance policy must recognize the CSV as an asset, measured at the amount that could be realized upon termination of the policy prior to the insured’s death (as provided by the insurer). The net effect of premiums paid and changes in CSV during the period should be presented on a net basis (with net credits as income and net debits as expense). The guideline is effective for fiscal years beginning on or after January 1, 2026, although early adoption is permitted.
Check out a summary of the Guideline HERE.
How to Talk to an Employee Who Isn’t Meeting Expectations
Approaching a conversation about improving an employee’s performance requires preparation, empathy, and a focus on collaboration. Even though hearing the truth about their current performance will be tough and potentially hurtful, it’s a teaching moment managers must embrace to help them become more resilient and adept at problem-solving and developing professional relationships. The author offers several strategies for treating difficult performance conversations not as fault-finding missions, but instead as opportunities to work collaboratively to define a shared commitment to growth and development.
CPAs and AI: Empowering the profession’s future
This compelling three-part series from CPA Canada (in collaboration with AICPA) reveals how AI and automation are already reshaping the CPA profession—streamlining routine tasks, driving real-time audit transformations, and enabling deeper strategic analysis. It provides trusted, ethically grounded guidance on governance, transparency, and assurance in AI-powered environments. Whether you’re keen to stay ahead in tech-driven finance or eager to strengthen your role as an ethical steward of emerging tools, this series is a must-read for forward-thinking CPAs.
Avoid BYOAI: The importance of AI training in the workplace
This article makes a powerful case for why AI training is no longer optional—it’s essential. As AI reshapes how work gets done, finance and business professionals who receive practical, role-specific upskilling are far better equipped to boost productivity, reduce risks, and foster trust in automation. It emphasises the leadership’s responsibility to champion AI fluency across teams and embed ethical governance into training strategies. The piece draws on recent data showing that while younger workers are quick to adopt AI, many organisations still lack formal learning pathways—highlighting a critical gap leaders must address now to unlock real value from AI.
Professional Development: Plan Ahead, Choose the Right Course
As noted above, it’s not just about meeting CPD requirements, it’s about choosing professional development that adds real value to your firm. Whether you prefer live sessions, virtual workshops, or recorded on-demand learning, planning now helps avoid the year-end scramble and ensures you’re focusing on the skills that matter most.
There are many great PD sessions out there, including ASK KSA PD. We offer a wide range of courses designed specifically for SMPs. You can explore the full offering here: ASK KSA PD Courses.
ASK KSA PD Course of the Month:
Audit Hot Topics
Staying current with auditing standards is essential, but applying them effectively in real engagements is where firms can truly excel. Audit Hot Topics is a 2-hour, verifiable CPD course designed to help practitioners tackle common challenges in audits of less complex entities. Through practical strategies and clear explanations, the course covers key areas including planning and risk assessment (CAS 315), fraud considerations (CAS 240), sampling and evidence gathering (CAS 530 & CAS 500), auditing estimates (CAS 540), and reporting requirements (CAS 700). It’s a focused way to strengthen your technical knowledge and documentation practices.
Perfect for small and mid-sized firms, this self-paced course provides practical, actionable insights that can improve engagement quality, reduce rework, and minimize inspection issues. Invest in your team’s confidence and competence. Learn more and register today.
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As firms continue to navigate ever-evolving accounting and assurance standards, it’s clear that staying informed isn’t just about compliance; it’s also about strengthening your firm’s foundation for the future. Remember, I am always here to help you save time and achieve peace of mind. Reach out any time.
Best regards,
Kirsten S. Albo, FCPA, FCA
President