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State Board Report

November 2016

After having received responses from 36 Boards of Accountancy to its survey, the Compliance Assurance Committee (CAC) prepared NASBA’s response to the AICPA’s paper on changes to the administration of the AICPA’s Peer Review Program (Proposed Evolution of Peer Review Administration: A Supplemental Discussion Paper Seeking Input from State Boards of Accountancy). “How could we disagree that anything that is good for the quality and consistency of the Peer Review Program is good for the profession and the public?” asked CAC Chair John F. Dailey, Jr. (NJ). Reviewing NASBA’s comment letter sent to the AICPA, Mr. Dailey told the Annual Meeting it included issues raised by the State Boards, both via the survey and copies of comment letters sent directly to the AICPA. These fell into six general categories: oversight, costs, consolidation, national administering entity, reviewer/volunteer pool and transparency. The letter has been posted on www.nasba.org and printed copies were distributed to the Annual Meeting attendees.

“A majority of the member Boards believe that all administering entities (AEs) that wish to continue in operation should be allowed to do so as long as they can meet the Peer Review Program’s new standards and criteria,” Mr. Dailey stated. Rather than having the AICPA operate as a national AE, Mr. Dailey said: “NASBA’s response urges AICPA to focus its efforts on committing resources and training to AEs when situations arise that could disrupt or diminish an AE’s administration efforts.” The CAC felt that a problem could be created if the AICPA were both to operate as an AE and to also provide oversight of that AE.

The NASBA letter, as developed by the CAC and the Regulatory Response Committee, cautioned: “Should the evolution result in a national or in regional PROCs (Peer Review Oversight Committees), access to data and program transparency are critical to effective oversight.” It also pointed out that the Boards need to be given adequate time to implement whatever changes are decided upon, Mr. Dailey noted.

An e-mail to the Boards’ chairs and executive directors from the AICPA announced that a new paper on the proposed changes is to be available on January 4, 2017 and a webinar on it has been scheduled by the AICPA for January 9, 2017, Mr. Dailey reported. He assured the Boards that the CAC will stay focused on this project and adjust its recommendations as needed.

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