AICPA Board Could Revise Benefit Plan Audit Proposal
The American Institute of Certified Public Accountants’ Auditing Standards Board could revise a proposal for audits of benefit plans under the Employee Retirement Income Security Act of 1974 (“ERISA”). At a meeting last month in New Orleans, the board discussed possible changes after reviewing comment letters on Proposed Statement on Auditing Standards: Forming an Opinion and Reporting on Financial Statements of Employee Benefit Plans Subject to ERISA.
The proposed standard aims to help auditors understand their role and provide interested parties additional information on auditors’ responsibilities, especially in circumstances when the audit’s scope is limited. After previous talks on submitted feedback regarding the proposal, the task force recommended re-characterizing the nature of the audit engagement since several commenters were uncertain whether they could back an updated audit report. The task force believes that the ERISA-permitted limitation of the audit’s scope should be assessed based on AU-C Section 705, “Modifications to the Opinion in the Independent Auditor’s Report.”
In response to the task force’s recommendation of re-characterizing the concept, the board agreed and suggested it consider using a citation from the ERISA rules to explain the audit engagements. Additionally, the board supported a proposed audit report form from the task force when the scope of an ERISA audit is limited. The new form would be used for a special purpose audit that follows ERISA requirements. The task force was asked to continue work on that form.
The board is expected to discuss the proposal again at a future meeting. Its next scheduled meeting is set for May.