Regulation and Oversight UpdateOctober 29, 2014

Curtis B. Lee, RTP Admin ChairStephen Haworth & Sharron Cirillo

Regulation and Oversight Committee

State Issues Pending/AnticipatedUAA Issues

AICPA IssuesHow to Read and Analyze a Bill

PENDING / ANTICIPATED ISSUES

Montana•MT 6558 2014 – Rule Changes•Lots of definitions•No public participation on licensing decision•Anonymous Complaints from “shall review” to “may accept”•CPE not required to meet NASBA standards unless self study

Wisconsin•2013 Act 210 Enacted 4.8.2014•120 hours to sit•Attest service – SAS SSARS SSAE ASB of PCAOB

– Audit or other engagement– Review or Compilation – Examination of Prospective Financial Information– Updated Code of Conduct

•Engagement Review– Highest level of service SSARS SSAE and not peer reviewed– Ascertain whether “Documents Conform” to Standards

•System Review– Highest level of service GAS, Examinations, non public audits– Designed to determine whether firms system of quality control …is

designed & enforced …reasonable assurance …conformity with Standards No. 8 – all material respects

Ohio•Effective June 2014 – pending Joint Agency Review•Incremental CPE – first state in the county•10 minute increments•Now working on conforming to UAA•February 2015 – Discuss Peer Review

Delaware•At discussion stages now – not yet introduced or written•PAs a dying class – December 31 2015•Peer Review for all (not currently required)•Codification to UAA

Arkansas

•Poll of states regarding requirement for Peer Review and Quality Review for Public Accountants•Peer Review(CPAs) vs. Quality Review(All)•Retirement of Quality Review?•Access to program for PA’s?

Alaska•Board of Accountancy is discussing the definition of attest in Statute vs. UAA vs. common knowledge and Approved Quality Review Programs (compilations exempt).•UAA does not classify Compilations as an Attest Function.•Quality Review(Any) vs. Peer Review (CPA)

Illinois•SB 2774 HB 4381•Tax Preparer Registration Bill •“Commercial Tax Preparers”•Tax Franchises behind it?•Started as a Task Force Type Bill then grew horns

Colorado•HB 1285 – Died in the senate•Tax Preparer Registration Bill•Exempted Employees of CPAs•Lobbyist and Executive Director

North Carolina•NC Board is drafting a response to the proposed changes to the peer review standards•Plain paper financials not part of peer review•Require language “no assurance”•Preparation does not equal issuance vs. “associated with” concept•NC Board Supports the proposed changes

UAA ChangesDefinition of Attest unchanged

Peer Review Standards Exposure Draft

AICPA•SSARs 21•Special Purpose Framework•Updated Code of Conduct

The Responsibility Poem by Charles Osgood

There was a most important job that needed to be done,And no reason not to do it, there was absolutely none.

But in vital matters such as this, the thing you have to askIs who exactly will it be who’ll carry out the task?

Anybody could have told you that Everybody knewThat this was something Somebody would surely have to do.

Nobody was unwilling; Anybody had the ability.But Nobody believed that it was their responsibility.

The Responsibility Poem by Charles Osgood

It seemed to be a job that Anybody could have done, If Anybody thought he was supposed to be the one.

But since Everybody recognized that Anybody could, Everybody took for granted that Somebody would.

But Nobody told Anybody that we are aware of,That he would be in charge of seeing it was taken care of.

And Nobody took it on himself to follow through,And do what Everybody though that Somebody would do.

The Responsibility Poem by Charles Osgood

When what Everybody needed so did not get done at all, Everybody was complaining that Somebody dropped the ball

Anybody then could see it was an awful crying shame,And Everybody looked around for Somebody to blame.

Somebody should have done the jobAnd Everybody should have,But in the end Nobody didWhat Anybody could have.

Don’t be a Nobody.Be a Somebody.

For the good of Everybody.

Now let’s ROC…

Regulation and Oversight Analysis and Action

Or Analysis in Action…

Gather Materials

Homework 1-4

NSA 911 Contact

ASO Understanding and Consensus

Jeopardy

Gather your materials•Copy of proposal

– Bill # – Is it in the House or the Senate– Regulation (usually from board website)

•Copy of the existing information– Law– Rules

•Computer– With Microsoft Word

•Homework from next page•Caffeine•Three of your favorite practitioners•NSA 911

Homework1.Create a secret decoder ring– Summary of Each Section of Law – Open MS Word (2 computers side by side)• On computer 1 – open the existing law • Click Review and New Comment to add sticky

notes on areas of concern or to summarize• On computer 2 – list the law down the left by

section number• Repeat for rules. List the sections on the same

page as the law

3. Have a friend check the redline version4. Print and distribute to 3 besties and / or our committee – See NSA 911• Considerations

– with comments or without?– revision with dates in the footer– To turn comments/changes on/off for printing – review tab

Contact NSA Committee•What issues do we see? – Missed issues– Validation– Presentation – word smithing

•Background we can provide•Testimony resources•Strategy ideas

Develop ASO position and Strategy•Is there a concrete position or set of positions??•Impact on “special” populations•Congruent with mission statement?•OMB statement – financial impact•Other states•Consistency or Non Consistency with UAA•What would your consider caving on? SHHHHHH!•Who is the sponsor and “who” are they

– Who are they connected to? • Committees, regular jobs, spouse/kids, volunteer boards

•Other Major Players•Impact of similar legislation on fees – NFIB•Related organizations to consider

This is Jeopardy…