Single Audits and Peer Review
Are your Clients Requesting New Single Audit Services?
The Coronavirus Aid, Relief, and Economic Security (CARES) Act allocated significant amounts of money in new aid to non-federal entities requiring many of them to complete a single audit perhaps for the first time. A single audit also requires the financial statement audit to be performed under Government Auditing Standards (GAS). You may be asked to perform single audit engagements as your clients navigate the requirements of the CARES Act. Single audits are complex highly specialized audits focused on compliance with federal laws or regulations (and internal controls to ensure compliance) that apply to specific federal funds. If your firm performs a single audit engagement, it will be required to have a system review, which includes a review of at least one single audit engagement (or the audit of those compliance requirements and internal controls over compliance with those requirements). Please let us know if you plan to perform these services, and make sure to update your Peer Review Information (PRI) form in PRIMA to reflect single audit engagements!
Do COVID-19 Funds Bring Peer Review Requirements?
A common question CPA firms are asking AICPA peer review staff is related to Paycheck Protection Program (PPP) loan forgiveness services and whether they are performing an engagement subject to peer review. You may be asked to check calculations performed by your client for accuracy and issue a report on your findings. This may indicate an agreed-upon procedures engagement is needed or has been performed. If your firm is not otherwise subject to peer review, the performance of an agreed-upon procedures engagement under the Statements on Standards for Attestation Engagements (SSAEs) would require your firm to undergo an engagement review.
If you need help determining whether you’ve performed an agreed-upon procedure, call the AICPA A&A Technical Hotline at 877.242.7212.
If you need help determining whether your firm needs a peer review, call the AICPA Peer Review Team at 919.402.4502.
Refer to the PPP loan forgiveness services matrix for a tool to help firms navigate their engagements or other services around documenting expenses related to PPP forgiveness. See also SBA Paycheck Protection Program (PPP) resources for CPAs to access additional information on the program.
Peer Review Reminder!!!
While peer reviews, corrective actions and implementation plans are no longer receiving automatic due date extensions, extensions may be granted in certain circumstances.
Given this, 2021 is expected to be a busy year for peer reviewers. The AICPA is encouraging firms to be proactive in scheduling their peer reviews!