NASBA Responds to BOE and PCAOB

SHARE:

NASBA encourages the AICPA to continue to evolve the Uniform CPA Examination by introducing additional analysis and evaluation simulations across the sections, but is also concerned about de-emphasis of business law topics on the Examination, as stated in its April 30, 2020 response to the AICPA Board of Examiners’ “Maintaining the Relevance of the Uniform CPA Examination: An Exposure Draft and Invitation to Comment”  https://nasba.org/app/uploads/2020/05/April-30-2020-NASBA-Response-to-Practice-Analysis.pdf.  The letter documents NASBA’s support for the removal of essay questions in BEC,  but urges “the AICPA to continue research projects into testing communication in conjunction with content and skills for inclusion in future versions of the Exam.”

The NASBA response letter was developed by several NASBA Committees over the past few months and: “All who participated in drafting the NASBA response believe that completely removing state and local (S&L) government accounting from the Exam is inappropriate.  All feel that, at a minimum, basic coverage should be retained,” the letter from Chair Laurie J. Tish and President and CEO Ken L. Bishop states.

Aligning the Public Company Accounting Oversight Board’s quality control standards with the proposed international standards is supported by NASBA, states NASBA Chair Tish’s and President and CEO Bishop’s March 11, 2020 letter in response to the PCAOB’s concept release entitled “Potential Approach to Revisions to the PCAOB Quality Control Standards.”  It states: “Aligning standards allows CPAs and firms to adopt responses to be utilized across engagement teams and within their networks/affiliations.”  They also voice support for principles-based standards, rather than rules-based standards, “as that approach would help with the scalability of quality control standards for smaller firms.” 

The PCAOB asked for comments on the sufficiency of principles- based requirements to prompt firms to identify and respond to risks.  The NASBA letter states: “We believe that supplemental direction is needed.  It would be helpful for the PCAOB to issue guidance, including illustrative QC policy documents, especially for the envisioned incremental content for PCAOB audits.  The guidance should include illustration of how the content could be scaled for audits of less-complex entities.”

Read NASBA’s full response on https://nasba.org/app/uploads/2020/03/Mar-11-2020-NASBA-Response-to-PCAOB-QC-Release.pdf.   Letters in response to the International Ethics Standards Board of Accountants’ exposure drafts on non-assurance services and on fee-related provisions of the international Code of Ethics for Professional Accountants  will be released in May.  These will also be posted on the publications page of NASBA’s website as they are submitted.