Peer Reviews Extended for 6 Months; Offsite Work Still Possible
CPA firms will be granted six-month extensions for peer reviews, corrective actions and implementation plans with original due dates between January 1, 2020, and September 30, 2020, according to the AICPA Peer Review Board (PRB). Extensions will be granted automatically in the Peer Review Program’s PRIMA operating system.
The Journal of Accountancy reported that the PRB and the AICPA Peer Review Program staff will continue to monitor the situation through the summer and will evaluate whether automatic extensions are appropriate for firms with due dates after September 30, 2020.
The AICPA will update PRIMA between May 18-22 with extended due dates and extension letters, in addition to sending auto-generated notifications, for eligible firms with details and instructions for moving forward.
Despite the extended due dates, firms do not need to wait an additional six months. Though the PRB recognizes some changes may be appropriate for other reasons, they indicated the changes should not be granted solely because of the COVID-19 extension.
The Ericksen Krentel peer review team encourages you to still contact us as your normal deadline approaches to conduct your review as soon as you can to continue ensuring quality in your audit processes.
That includes conducting offsite, remote reviews. Our team has adjusted our review process to work with you and your team remotely, if necessary, to ensure maximum efficiency, accuracy and quality.
If you are interested in performing an offsite review, please contact Eric Powers by clicking here. Take note:
- Completion of the Offsite Review Request Form or advanced approval of an offsite system review from the firm’s administering entity will not be required.
- If a review can be performed offsite, document your rationale in the SRM.
- The reviewer will need to consider aspects of the review to determine if it can be appropriately performed offsite, which include, but are not limited to:
- Availability of the firm’s working papers.
- Accessibility of key personnel for effective interviews and timely responses to questions.
- Other risk factors that would suggest an offsite peer review would not be effective.
As for the automatic six-month extension, the AICPA, by way of the Journal of Accountancy, provided the following examples:
Example 1: Firm undergoing peer review
- Original due date: March 31, 2020
- Extended due date: May 31, 2020
- New due date: September 30, 2020 (six months from original due date)
Example 2: Firm undergoing peer review
- Original due date: November 30, 2019
- Extended due date: February 29, 2020
- New due date: February 29, 2020 (no change as the firm’s original due date was in 2019)
Example 3: Firm required to complete a corrective action plan
- Original due date: February 29, 2020
- Extended due date: April 30, 2020
- New due date: August 31, 2020 (six months from original due date)
Example 4: Firm required to complete a corrective action plan
- Original due date: September 30, 2020 (established by Report Acceptance Body (RAB) at June 1, 2020, meeting)
- Extended due date: To be determined
As requirements and guidance change, Ericksen Krentel professionals are available to help you. As questions or concerns arise, we ask that you contact us so we can address them as quickly as possible to ensure we continue to meet your needs. As a reminder, you can always monitor our COVID-19 Updates webpage by clicking here for the latest or monitoring our accounts on LinkedIn, Twitter or Facebook.
About Ericksen Krentel
Ericksen Krentel CPAs and Consultants, founded in New Orleans, Louisiana in 1960 with offices in New Orleans and Mandeville, believes that serving as the clients’ most trusted adviser is grounded in going beyond the numbers.
That includes helping clients achieve their business and personal financial goals by providing innovative and exceptional services in the following areas: audit and assurance services, tax compliance and planning, outsourced CFO services and business valuations for a variety of industries; employee benefit plan audits; fraud and forensic accounting; business planning; IT consulting; loss calculations; and estate planning.
Learn more at www.ericksenkrentel.com.