Greetings, At the beginning of the month I was still golfing and now there are several centimeters of snow on the ground. It reminds me that winter is coming, if not already here. This month’s update includes a technical topics that are relevant in the near future and planning now will help you be more efficient later. Also included are topics to help you continue to build your business. Read on…
CSRS 4200 Implementation Guidance
Even though the new compilation standard is not effective until 2021, I continue to encourage practitioners to think about implementation matters today. There are many activities you can undertake between now and then to lessen your work effort. CPA Canada has published a good implementation tool. You may also want to consider participating in one of the upcoming on-line PD workshops I am offering (link below). As Benjamin Franklin said, “If you fail to plan, you are planning to fail”.
The Professional Engagement Guide (PEG) has released the second and final phase of the 2020 update. Volume 2 has now been updated for CAS 540 (Estimates) and CSRS 4200 (Compilation Engagements). New Volume 3 which include case studies and filled-in forms has also been released.
Section 3065 Leases – Relief in Amendments Due to COVID
The Accounting Standards Board is amending Section 3065, Leases, in early November. This amendment is good news as it provides relief for both lessees and lessors on accounting for lease modifications received or granted as a result of the COVID-19 pandemic. The amendments apply to annual financial statements ending on or after December 31, 2020, with earlier application permitted.
For the 2020 tax year, the CRA will be introducing additional reporting for T4 slips. The additional reporting requirements will apply to all employers and will help the CRA validate payments under CEWS, CERB and CESB. Be aware of these requirements if you prepare T4 slips for your clients or as your client asks for assistance.
Firms can be challenged by marketing at the best of times. While referrals are a good source of business, it is important to not forget about marketing. Where to begin? Accounting Today outlines five marketing priorities to help keep your firm relevant. The tips are practical and simple to implement.
Your website is the first priority identified in the article above and therefore you want to make it relevant, especially in today’s landscape of limited face-to-face meetings and working remotely. Websites are becoming increasingly valuable business tools, especially for business development. This article has some good ideas on improving your website and is worth the read.
I never thought about changing my wifi settings as I am out and about working from various locations until I read this article. Now that people are working from home or other locations, the tips on protecting your data are more relevant than ever.
I believe this will be a busy fall, continuing the busy summer we had. The more you plan for the upcoming months, the easier it will be. As always, I am here to help you save time and achieve peace of mind. Reach out anytime.
Fall has officially arrived and I think it will be a busy one. There is a lot on the go from every aspect of running a practice. Planning engagements, practice management and professional development all seem to fall (pun intended) into this time of year. This month’s topics will help you get ready for everything that needs to get done. Read on…
Agreed Upon Procedures
The new Agreed Upon Procedures standard (CSRS 4400) has been approved and is effective for engagement terms agreed upon on or after January 1, 2022. There are many improvements to the new standard and it is consistent with other recent changes, therefore you may want to consider early adoption for upcoming AUP engagements I don’t believe the transition will be difficult in this case. A blog by CPA Canada will help you understand the new standard and its implications.
Last week the International Standards setters approved the new suite of quality management standards replacing ISQC1. Why do Canadian practitioners care about these new standards? We care as the AASB has exposed draft standards on the same topic to replace CSQC1. I wrote a LinkedIn article on the expected changes and the issues faced by the AASB as they consider the unique aspects of the Canadian market.
Phase one of the 2020 version of PEG released in August. Practice Aids and Volume 1 are now available on Knotia (soon to released in Jazz-it and Caseware). Changes are classified as Major, Moderate or Minor. Phase two which includes Volume 2, case studies and other content will be available in October. Highlights of the significant changes included the release of letter and practice aids related to CSRS 4200 Compilation Engagements practice aids related to CAS 540 Estimates. The What’s New Section has a good summary of all the changes. LOG INTO KNOTIA HERE TO ACCESS THE PEG
Quality Can Help Firms Grow
Having a proper quality control system in place, especially with the upcoming changes, can help a firm be successful and grow. “Firms love to land new clients and keep their current clients happy. After all, acquiring new business and retaining it is the key to growth” says author Cheryl Meyer (Journal of Accountancy). Revenue growth can cause problems if a firm does not have the proper control system in place. The article includes a number of tips on implementing a solid system of quality management.
5 Missteps to Avoid when Evaluating Internal Controls
Auditors are required to obtain evidence related to the design and implementation of controls, whether or not controls are going to be relied up. This is an area where practitioners often struggle, especially in the audits of less complex entities. An article in the Journal of Accountancy outlines five missteps to avoid in the process of evaluating internal controls A good article to help you be effective and efficient.
Understanding Your Client: COVID-19 Implications for Internal Controls
COVID-19 related events and conditions have likely caused changes to entities’ operations and internal control further complicating design and implementation requirements. Changes in operations may result in new or changed risks, processes, and controls. Listen to this special, and practical, practitioner’s webinar from CPA Canada to learn more.
Path to Implementation – CSRS 4200 October 16, 2020 October 28, 2020 November 12, 2020 November 23, 2020
Putting Ethics into Practice November 19, 2020 December 18, 2020
Assurance and Accounting Updates In-house offerings available. Contact me for details. Online dates coming shortly.
How do you like the new monthly update format? I would love to hear your feedback. There are a number of new initiatives I have recently undertaken. In addition changing the format of my newsletter, I am now delivering professional development sessions online. ASK KSA PD courses are unique in nature as they are interactive and engaging and very practical. As always, I am here to help you save time and achieve peace of mind. Reach out anytime.
In this Update: Professional Development; Standards Update; AUP Engagements; PEG Updates
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.
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.
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.
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.
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
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 HEREto 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
In this Update: Standards Updates; PEG Updates; Firm Risk Management; Pricing Client Engagements
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…
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.
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.
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).
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.
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