Survey: Lenders’ Views on a New Proposed Standard for Compilation Engagements
Significant changes are being proposed by the Auditing and Assurance Standards Board (AASB) to the current standard on compilation engagements. The impact of these changes will be felt on a wide variety of stakeholders – including loan officers who use compiled financial information when granting loans or extending credit to small and mid-sized companies.
The AASB sets standards for services engagements performed by professional accountants in public practice, such as audit, review and compilation engagements. The proposed changes to compilation engagements are outlined in its Exposure Draft, out for public comment until November 30, 2018.
In addition to responding to the Exposure Draft, we are seeking feedback via survey on the new proposed Compilation Engagement Report to replace the current Notice to Reader communication. The proposal also includes a new requirement to disclose in a note to the compiled financial information the basis of accounting applied in the preparation of the financial information.
The AASB will use the aggregated results to help determine what revisions, if any, to make to the proposed standard on compilation engagements before it is finalized.
The new standard on compilation engagements is expected to be effective in the second half of 2020.
Svetlana Berger, CPA, CA, MAcc
Principal, Auditing and Assurance Standards Board
Phone: +1 (416) 204-3231