August 2020 Update

August 31, 2020 / Uncategorised

In this Update:  Professional Development; Standards Update; AUP Engagements; PEG Updates

Greetings,

This has been a busy month; despite the fact it is August. From my discussions with many of you, it seems we are all still catching up from the past few months and trying to get organized for the upcoming months. There has been a lot of activity related to Handbook updates along with related tools and practice aids, so much so I sent out two special updates earlier this month. I included the information again in this month-end update as they are so important I don’t want you to overlook them. Other topics this month are to help you get ready for fall and beyond. Read on…   


Path to Implementation – CSRS 4200 (ASK KSA Professional Development Course)

You have been reading information about the new standard for months now and it is time to act. The standard is effective periods ending on or December 14, 2021 – that is only 18 months from now!! What are you doing to get ready? I will be leading a Professional Development Course to help you understand the requirements and develop an implementation action plan between now and the effective date. The course is unique as it is practical in its approach and focuses on application, not technical.  

You will leave the course with a solid understanding of the standard and an implementation action plan. Tools and templates will be provided including a draft action plan, a scoping spreadsheet, basis for accounting template notes and documentation guidance.  

Registration will go live later this week but in the meantime, mark your calendars for the date that works best for you. The following sessions are currently available: 

  • September 17: 9 am – 12 pm CST  
  • September 23: 9 am – 12 pm CST 
  • September 24:  1:30 pm – 4:30 CST 

Each session will be live via Zoom and limited to 10 participants to allow for interactive discussions. As these sessions fill up, more will be added. Cost for the 3-hour verifiable CPD session is $600 plus GST. If you would like to arrange a separate session for your firm only (either in-person or on-line), contact me directly and we can arrange.  

READ COURSE DETAILS AND REGISTER HERE


Handbook Updates

The first special update of the month covered the CPA Canada Standards and Guidance Collection. There were many significant amendments and revisions in both the accounting and assurance sections of the Handbook. The accounting updates were for changes in standards for both ASPE and ASNPO. The assurance updates were revisions to certain CASs and the new standard CSRS 4400, related to Agreed-upon Procedures.  

ACCESS KNOTIA HERE (LOG IN)

READ ASK KSA DETAILED SUMMARY HERE


New Agreed-Upon Procedures Standard

Speaking of the new Agreed-Upon Procedures standard, CPA Canada published an article about this new standard which opens the door to a broader range of agree-up procedures (AUP) engagements. The new standard is effective for engagements for which the terms are agreed on or after January 1, 2022. In this case I believe early adoption is a good thing. The article covers the key differences between the existing standards (Sections 9100 and 9110) as well as things to watch out for when performing AUP engagements. Implementation tools will be coming but in the meantime, take a moment to understand the implications of the new standard. 

READ CPA CANADA ARTICLE HERE


Knotia PEG Release 

The second special update related to the 2020 PEG release. This year, the release will be in two phases. Practice Aids and Volume 1 are now available on Knotia. Volume 2, case studies and other content will be available in October. Highlights of the significant changes included the release of the new CSRS 4200 Compilation Engagements and CSRS 4400 Agreed Upon Procedures letters and practice aids and practice aids related to CAS 540. There were other changes that were classified as Major, Moderate or Minor. Read the What’s New Section to understand the updates or give me a call.  

READ ASK KSA DETAILED SUMMARY HERE


While we are busy these days, please take a moment to breathe and enjoy these last few dog days of summer (where did that saying come from anyway?). Remember, things will get done. I promise. I am here to help as needed. Have a great week. 

Best Regards,
Kirsten S. Albo, FCPA, FCA
President


Another Special August Update – PEG 2020

August 11, 2020 / Special Update

Greetings, 

One more special update. You will have received an email from Knotia yesterday about the 2020 PEG release. This is so important I wanted to bring it to your attention and highlight a few key changes. Read on…

There have been two substantial updates to professional standards this year: CAS 540 Auditing Accounting Estimates and Related Disclosures and CSRS 4200 Compilation Engagements. The PEG 2020 update reflects changes to these standards as well as many other changes. See further details below about the release which will take place in two phases this year. The Practice Aids and Volume 1 are now available on Knotia. Volume 2, case studies and other content will be available in October. Highlights of the significant changes are:  

Compilation Engagements, CSRS 4200:

  • As a reminder, the standard is effective for compiled financial information for periods ending on or after December 14, 2021, with early application permitted.
  • New practice aids are available. These include checklists, reports, and letters. You will want to consider what, if any, forms will be used in your practice.  
  • A new section was created for all resources related to the new compilation engagements standard. This includes a new chapter in Volume 1 (Chapter 45), new chapters in Volume 2 (Chapters 35 – 38). 
  • Stay tuned for training I will be putting on in September (dates to be determined shortly). The course will focus on implementation of the new standard and things you can do now, including developing an action plan between now and the effective date. The training will be an online live three-hour session (qualifies for verifiable CPD hours). Each session (several to be offered) will be limited to 10 participants to allow for interactive discussion and questions to help you save time and achieve peace of mind.  

Practice Aids (Checklists):

  • Before fully implementing the 2020 versions, you will want to ensure you understand the changes as bringing in the new form overwrites existing data. The What’s New Section goes through each form in detail outlining whether changes are Major, Moderate or Minor and what practice aids are new.  
  • Major changes have been made to various forms to include the new requirements from revised CAS 540, Accounting Estimates and Related Disclosures.
  • Moderate changes also been made to the Financial Reporting Framework (FRF) forms to reflect the changes to the ASPE standards relating to Section 3856, Financial Instruments.

Volume 1 and 2:

  • Updates in both volumes reflecting the changes made to CAS 540, Auditing Accounting Estimates and Related Disclosures.
  • On Knotia, the introduction chapters have been separated out as a stand-alone section. Additionally, the volumes are provided as a PDF, making searching for individual topics easier.

Volume 3: Case Studies (new Section coming)

  • Case studies have been reorganized to provide easy access to the material. Grouped by audit and review each case study includes written explanations along with the related filled-in forms

The details of the updates have been summarized by the PEG on Knotia in the What’s New Section. CLICK HERE to access Knotia (you will have to log in). I have also attached the What’s New document to this email to save you time so you do not have to go searching for it. If you have any questions about the implementation of the updated 2020 PEG forms, reach out at anytime.  I am here to help. Enjoy the rest of the month!!


Best Regards,
Kirsten S. Albo, FCPA, FCA
President


August 2019 Update

August 31, 2019 / Monthly Newsletter

In this Update:  Standards Updates; PEG Updates; Firm Risk Management; Pricing Client Engagements

Greetings,

The end of August is upon us and it has been a busy month. Summer is winding down (even though I don’t want to admit it) and minds are turning to fall and the planning that it brings. This month’s topics include matters that will help you get ready as you continue to think about upcoming standards changes, new PEG forms, quality management and discussing fees with your clients. Read on…

Standards Updates

No significant news to report but wanted to provide an update so you stay informed; changes are coming, that is a known! Exposure drafts being deliberated as response deadlines have passed. The key topics that will impact your practice include Quality Management (CSQM1 and CSQM 2), Identifying and Assessing Risks of Material Misstatements (CAS 315 Revised) and Compilation Engagements (CSRS 4200). A summary of the status of these is:

  • CSQM1/2 – The AASB agreed to perform further consultations with stakeholders on the proposed scope of Canadian Standard on Quality Management (CSQM) 1, Quality Management for Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or Related Services Engagements, in the fall of 2019. Standards expected in 2020.  READ QM UPDATE HERE
  • CAS 315 (Revised) – The AASB provided input to the IAASB on issues that are relevant to Canada. The Board will continue to discuss this project at future meetings. There is no proposed timeline on when the final pronouncement is expected but anecdotal evidence suggests early 2020.  READ CAS 315 UPDATE HERE
  • CSRS 4200 – The AASB is deliberating feedback received on the Exposure Draft. The new standard is being developed and is expected to be approved by the end of 2019 and effective for years ending on or after December 15, 2020.  READ CSRS 4200 UPDATE HERE

Other assurance exposure drafts still being deliberated include Key Audit Matters, for public companies, along with Public Sector Auditing Standards and Reporting Controls at a Service Organization. Responses to the Discussion Paper of Less Complex Entities were due this month and are now being deliberated. Finally, accounting exposure drafts on Agriculture and Revenue are still out there. 

PEG Updates

This month the 2019 Edition of the Professional Engagement Guide (PEG) was released. I have spent time understanding the changes and would be happy to discuss them further with you to determine what is most efficient and effective to implement in your practice. Key changes include:

  • A new chapter on data analytics in Volume 1. New chapters in both Volumes 1 and 2 have been added to provide guidance on assurance engagements to comply with specific requirements. These engagement are effective for reports dated on or April 1, 2019. This guidance covers either attestation or direct compliance engagements where either reasonable or limited assurance is being provided in a written report.
  • Sample assurance reports (finally!).
  • Some minor and a few major changes to the PEG audit forms, customized review forms for NPOs and new forms related to compliance reporting. 
  • In addition, an alternative set of review engagement forms has been developed. The idea is to use either all of the new forms, or all of the existing forms. It is not appropriate to mix and match sets. 

ACCESS PEG ON KNOTIA HERE (WILL HAVE TO LOG IN)

Ten Steps to Successful Firm Risk Management

Since quality management is top of mind with the CSQM1 and CSQM 2 Exposure Drafts, I thought you may be interested in an article to help you address quality matters in your firm. This is the second article of a risk management series and covers 10 steps for successful risk management. The first article is 8 steps to Establishing a Firm Risk Management program (link within). These articles are a result of discussions at recent IFAC SMP Committee meetings, the committee that is focused on practice management for small- and medium-size practices (SMPs).

READ ARTICLE HERE

How to Price Client Engagements and Increase Firm Profits

With all the changes coming, another topic that is top of mind is how to price engagements and discussing fee increases with your clients. The attached link is the second of a three-part series addressing this critical area; it covers approaches to fee increases and value pricing. The first in the series, the Importance of client Selection and Relationship Management (link within), features client classification and the importance of engagement letters and the third instalment will highlight credit control, collection techniques and dealing with conflict.

READ ARTICLE HERE


Lots to think about in the upcoming months but I am here to assist as needed to save you time and provide peace of mind. But first, enjoy the long weekend. Work will always be there, it is more important to spend time with your family and friends. I know I will this weekend. 

Best Regards,
Kirsten S. Albo, FCPA, FCA
President