Enhanced Formal Communications

Communications 530

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Overview New Statement of Accounting

Standards

• Rules Auditors must observe:

SAS No. 112 Changes SAS No. 115 Definitions SAS No. 115 Requirements SAS No. 115 Clarification

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Changes from SAS No.112

New Definitions

Significant deficiencies and material weaknesses is required to be encoded

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SAS No. 115 New Definitions Material Weakness

Significant Deficiency

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Clarifications from SAS No. 115Indicators of Material Weaknesses

•Deceit

•Summarization of formerly gathered financial records to radiate the adjustment of a material misrepresentation

•Recognition of misrepresentations

•Useless foresights

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Requirements of SAS No. 115

Examine control deficiencies• Significant deficiencies• material weaknesses

The deficiencies and weaknesses must be transmitted by letter• Communications is required to be encoded

Analyze if authorities with the identical knowledge will conclude the identical result.

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Summary New Standard SAS No. 115

• Overrides SAS No. 112

• Deeply analyze guidelines

• Aids in transmission information about intrinsic checking.

• Compare and analyze information about material weaknesses and significant deficiencies

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References American Institute of CPAs. (2010, July 14). Catalogs.

Retrieved April 28, 2012, from http://www.AICPA.org/_catalogs/masterpage/search.aspx?S=sas+112.

American Institute of CPAs . (2010, September 28). Employee Benefit Plan Audit Quality Center. Retrieved April 28, 2012, from http://www.ALCPA.org/interestareas/employeebenefitplanauditquality/resources/accountingandauditingresourcecenters/downloadabledocuments/summary_of_sas_no_115.pdf.

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