An Engagement Review is for firms that are not required to have a System Review and only perform services under Statements on Standards for Accounting and Review Services (SSARS) or services under the Statement on Standards for Attestation Engagements (SSAE) not included in System Reviews as their highest level of service. The objective of an Engagement Review is to evaluate whether engagements submitted for review are performed and reported on in conformity with applicable professional standards in all material respects. An Engagement Review consists of reading the financial statements or information submitted by the reviewed firm and the accountant’s report thereon, together with certain background information and representations and the applicable documentation required by professional standards.
A report with a rating of pass will be issued when the peer reviewer concludes that nothing came to his/her attention to indicate that the firm's work was not performed or reported on in conformity with applicable professional standards in all material respects. If the reviewer determines that nothing came to his or her attention to indicate that the work was not performed and reported on in conformity with applicable professional standards in all material respects, except in certain situations that explained in detail in the report, a rating of pass with deficiencies will be issued. If the reviewer determines that as the result of situations described in the report the work was not performed and/or reported on in conformity with applicable professional standards in all material respects, a rating of fail will be issued. If the reviewer issues a report with a rating of pass with deficiencies or fail, the firm is required to prepare and submit a letter of response. Illustrations of responses by reviewed firms who receive reports with a pass with deficiencies or fail disposition can be found in the AICPA Standards for Performing and Reporting on Peer Reviews.
For additional information about the performance of an engagement review, please review the Instructions to Firms Having an Engagement Review page.
Once all required documentation is received by the VSCPA, the review will undergo administrative and technical review before it is presented to the VSCPA Peer Review Committee. The Committee will accept the review, accept the review if the firm agrees to perform certain corrective actions or defer the review until their next meeting in order to resolve any outstanding questions. The firm will receive a letter explaining the action the Committee takes on the review within 10 working days of the action. Once the Committee accepts the review, an acceptance letter will be issued. At this time, the firm may wish to publicize the results of its review to clients. Firms should remember that the results of a peer review should not be published until accepted by the VSCPA Peer Review Committee.