AICPA Clarity Stnadards
AICPA Clarity Standards
The goal of the Clarity Project is to make the United States generally accepted auditing standards (GAAS) easier to read, understand, and apply. As the Accounting Standard Board (ASB) redrafted the standards for clarity, it also joined the standards with International Standards on Auditing (ISAs), which is issued by the International Auditing and Assurance Standards Board (IAASB). The ASB’s plan for the Clarity Project is to completely revise and recodify all existing auditing (AU) sections of AICPA Professional Standards. The result of the Clarity Project will make GAAS for governmental and nonprofit entities easier to understand and apply, as well as more consistent across international standards, while avoiding conflicting standards issued by the PCAOB for public companies.
The ASB issued many of the clarified standards in a single Statement of Auditing Standards (SAS) No.122, which will supersede most previous SAS. SAS No. 122 is codified in AU (audit) sections and each AU section has its own number and title. Another change resulting from the Clarity Project is the required format and wording of the standards. The typical format in a clarified SAS includes an introduction, objective, definitions, requirements, and application and other explanatory materials.
Specifically in considering governmental and not for profit accounting, the application and other explanatory materials section may include special considerations for audits of governmental entities and not for profit organizations. Furthermore, the Clarity Project states that the determination for materiality in an audit of a governmental entity may be influenced by laws and regulations since the primary users are legislatures and regulators.
Other changes for both public and private entities include a change in status of the 10 generally accepted auditing standards, the wording of the auditor’s standard report, and standards for group audits. In 2012, the complete body
The goal of the Clarity Project is to make the United States generally accepted auditing standards (GAAS) easier to read, understand, and apply. As the Accounting Standard Board (ASB) redrafted the standards for clarity, it also joined the standards with International Standards on Auditing (ISAs), which is issued by the International Auditing and Assurance Standards Board (IAASB). The ASB’s plan for the Clarity Project is to completely revise and recodify all existing auditing (AU) sections of AICPA Professional Standards. The result of the Clarity Project will make GAAS for governmental and nonprofit entities easier to understand and apply, as well as more consistent across international standards, while avoiding conflicting standards issued by the PCAOB for public companies.
The ASB issued many of the clarified standards in a single Statement of Auditing Standards (SAS) No.122, which will supersede most previous SAS. SAS No. 122 is codified in AU (audit) sections and each AU section has its own number and title. Another change resulting from the Clarity Project is the required format and wording of the standards. The typical format in a clarified SAS includes an introduction, objective, definitions, requirements, and application and other explanatory materials.
Specifically in considering governmental and not for profit accounting, the application and other explanatory materials section may include special considerations for audits of governmental entities and not for profit organizations. Furthermore, the Clarity Project states that the determination for materiality in an audit of a governmental entity may be influenced by laws and regulations since the primary users are legislatures and regulators.
Other changes for both public and private entities include a change in status of the 10 generally accepted auditing standards, the wording of the auditor’s standard report, and standards for group audits. In 2012, the complete body