Common Matters Identified During Peer Review

The most common matters and deficiencies I see in a peer review are: The firm did not have a policy related to monitoring and inspections or they had a policy but they weren’t following it  (No documentation of any inspections performed) Not establishing appropriate engagement quality control review criteria (EQCR) Not having a policy to ensure staff had adequate CPE.  Insufficient CPE hours in Yellow Book and ERISA. Having a policy that states the firm uses a particular third party practice aid (such as PPC) and then only using some of it which causes key audit and review items to be missed. Related to FASB, SSARS, and the clarified auditing standards Auditors’ report did not conform to the new clarified standards. (This is automatically a deficiency and results in a Pass With Deficiency rating pursuant to AICPA peer review standards. Currently there are no exceptions to this) No disclosure of tax years that remain subject to examination by major tax jurisdictions No disclosure of the date through which subsequent events were evaluated Failure to implement SSARS 19 (e.g. no current engagement letters could be located and report changes have not been made or incorrectly made) Engagement letters or reports contain references to financial statements being prepared Failure to include a title on the accountant’s report (compilation, review and audit) The financial statement titles do not match those identified in the accountant’s report Failure to appropriately document planning procedures, including risk assessment, planning analytics, the auditor’s understanding of client internal control and IT environment. Representation letters that were dated incorrectly, did not cover the appropriate periods or were missing required...

How Long Do You Need to Keep That?

GENERAL GUIDELINES FOR THE RETENTION OF YOUR PERSONAL AND BUSINESS RECORDS When in doubt do not destroy until seven years from the date you filed your tax return. BUSINESS RECORDS Record Description Retention Period General ledger, expense support records, inventory records, sales records, purchase orders, accounts payable and accounts receivable support, loan payment schedules, bank statements and cancelled checks, payroll records, employment taxes, employee files of terminated employees  7 years Bank reconciliations, Employment applications, 3 years Insurance policies, minor contracts, lease payment records Life of contract + 4 years Audit reports and annual financial statements, Depreciation schedules, fixed asset purchases, tax returns, board minutes, business licenses, Bylaws, major contracts, leases, mortgages, patents/trademarks, shareholder and stock records, Pension/profit sharing and other employee benefit plans, real estate purchases, improvements or construction records Permanently retain   Personal Records When in doubt do not destroy until seven years from the date you filed your tax return. Bank statements, deposit slips, cancelled checks, tax returns, W-2s, 1099s, charitable contribution support, credit card statements, mileage logs, receipts used as a tax deduction, appointment calendars,  7 years Mutual fund and investment statements, dividend reinvestment records, year-end statements from your broker, purchase documents for investment property, home purchase documents, loans, home improvement receipts and cancelled checks, Keep these until 7 years after you no longer own these...