Bookmark and Share

State Board Report

December 2014

In November, NASBA submitted three letters of response to invitations to comment from the AICPA Enhancing Audit Quality Group, Board of Examiners and International Ethics Standards Board for Accountants. All three responses can be found in the News section of this website. The various responses were developed for NASBA President Ken L. Bishop and Chairs Carlos E. Johnson and Walter C. Davenport by volunteers from across the country who serve on: the Ethics Committee, chaired by Raymond N. Johnson (OR); Compliance Assurance Committee, chaired by Janice L. Gray; Education Committee, chaired by Thomas R. Weirich (MI) and Robert J. Cochran (VA); CBT Administration Committee, chaired by Richard N. Reisig (MT); Executive Directors Committee, chaired by Mark H. Crocker (TN) and Russ Friedewald (IL); and the Regulatory Response Committee, chaired by W. Michael Fritz (OH).

Responding to “Enhancing Audit Quality – Plans and Perspectives for the U.S. CPA Profession,” the NASBA letter states: “Consider forming a separate research and analysis group to analyze peer review trends, areas of repeat findings, cases that come before State Boards and provide insights to the profession regarding the deficiencies identified in peer reviews and related root causes (in order to share knowledge and improve quality overall). The AICPA should also consider coordinating with the State Boards of Accountancy, CAQ, PCAOB and other regulators to bring together all parties interested in continuous improvements for the profession.”

Commenting on the IESBA’s “Proposed Changes to the Code Addressing the Long Association of Personnel with an Audit or Assurance Client,” the NASBA letter stated: “With respect to any staff below a key audit partner (KAP), we recognize that such staff may be responsible for identifying issues that are eventually decided upon by the KAP. Further, junior staff usually move into more senior staff positions, and they may grow into decision making positions where they are familiar with a client. Hence, we believe that the general provisions should apply to the evaluation of potential familiarity threats that may exist for all individuals on the audit team.”

The Board of Examiners’ “Invitation to Comment: Maintaining Relevance of the Uniform CPA Examination,” drew many comments. One of the recommendations in the NASBA letter was: “Several Boards of Accountancy have approached NASBA with a request for year round testing and, more specifically, with a request for opening the month of June for Examination testing as an accommodation to those candidates who are either still in school or have just graduated in May. We encourage the AICPA to continue exploring avenues to alleviate or diminish the need for dark months, and also work with NASBA to consider what improvements could be made to the testing schedule.”

Check the Publications section of this website for NASBA’s responses to the latest professional inquiries. Responses related to ethics and peer review issues are currently under preparation.

Related News

Full Issue