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Peer Review Information


All peer reviews administered by the VSCPA are performed under the AICPA Standards for Performing and Reporting on Peer Reviews.

Peer Review Program | Top

The VSCPA Peer Review Program is subject to administrative oversight of the Program and staff every other year by the American Institute of CPAs (AICPA). In addition to the on-site oversight conducted by the AICPA, the VSCPA Peer Review Committee Chair performs oversight during the years between AICPA on-site oversight. The 2016 oversight report requirement was waived.

In an effort to provide greater transparency for the program, the AICPA Peer Review Board has requested that all administering entities prepare an annual report on oversight. This report provides detailed information and statistics regarding Virginia's enrolled firms. It generally is released about two years after the year being reported in an effort to capture as many reviews as possible.

Enrollment Information | Top

Does your firm need to enroll in a peer review program? If your firm is performing accounting and auditing engagements that fit the definition below, then the firm must enroll.

Accounting and auditing engagements for the purposes of peer review are defined as all engagements covered by Statements on Auditing Standards (SAS), Statements on Standards for Accounting and Review Services (SSARS), Statements on Standards for Attestation Engagements (SSAE), and the Government Auditing Standards (Yellow Book) issued by the U.S. Government Accountability Office Office (GAO).

The AICPA runs peer reviews through its Peer Review Integrated Management Application (PRIMA) on May 1, 2017. This document (PDF) details the process for using PRIMA to manage your peer review.

The AICPA's revised SSARS 21 revised the standards for reviews, compilations and engagements to prepare financial statements, including allowing CPAs to prepare financial statements without presenting a compilation report. Virginia's SB 1125 amended the accountancy statutes to clearly include the preparation of financial statements under the services for which a firm license is required, whether or not the CPAs in question are providing attest and compilation services. Firms otherwise subject to peer review that also perform the preparation of financial statements under SSARS 21, Sec. 70, will have such engagements included within the scope of their peer reviews.

Firms that perform the preparation of financial statements under SSARS 21, Sec. 70 as their highest level of service, while required to have a Virginia firm license, are not required to enroll in the Peer Review Program. However, should these firms choose to enroll, then a peer review is required. 

If your firm does not have any AICPA or VSCPA members and you would like information on the VSCPA Peer Review Program, please click here. (State Board of Accountancy Firms)

The Peer Review Process | Top

Enrollment — After a firm's enrollment has been approved, a due date for the firm's initial review is assigned. Generally, the due date for the firm's first review is set about 18 months after program enrollment.

Scheduling — Approximately six months before a firm's review due date, scheduling instructions will be sent via email. This must be completed in the PRIMA system in order for the review to be scheduled. It is the firm's responsibility to choose its own reviewer. The review should not commence until the firm has received notification that the reviewer has been approved to perform the review.

After the review — Once the review has been completed, the reviewer will submit a copy of the review report and required working papers via PRIMA. If no deficiencies were noted, the firm is not responsible for submitting anything. If the report noted any deficiencies, the firm is responsible for submitting a copy of the review report issued by the reviewer and the firm's letter of response (LOR) to those comments. If applicable, the firm must submit these materials via PRIMA within 30 days of the date the reviewer issues the report.

Administrative and technical reviews — These ensure that all the required documents from the reviewer and the firm are received and complete. The technical reviewers determine whether the review has been conducted in accordance with governing standards, and whether the firm has responded to any findings in an appropriate manner.

Committee process — Once all of the review documents have been through the administrative and technical review process they are presented to the Peer Review Committee for consideration of acceptance. After the Committee meets and accepts a review, firms should receive the review acceptance letter from the VSCPA within 14 days. However, some firms may be required to perform certain corrective follow-up actions before the review can be closed. Generally, except in the case where extensions have been granted, a firm's next review due date is set three years later.

All peer review documents and results are confidential. It is the firm's decision whether or not to publicize or release their peer review results. However, firms should remember that the results of a peer review should not be published until after the VSCPA Peer Review Committee has accepted it.

Types of Reviews | Top

System Review
This type of review is for firms that perform engagements under the Statement on Auditing Standards (SAS), the Government Auditing Standards (Yellow Book), examinations under the Statement on Standards for Attestation Engagements (SSAE), or audits of non-SEC issuers performed pursuant to the standards of the PCAOB as their highest level of service.

Engagement Review
This type of review is for firms that are not required to have a System Review and only perform services under SSARS or services under the SSAEs not included in System Reviews as their highest level of service. Early acceptance is possible if the firm passes with no Findings for Further Consideration. Such reviews are accepted early on behalf of the committee and the acceptance letter typically will be sent within a week or so after the team captain submits it to the VSCPA.

Click here for an AICPA overview of the differences between system and engagement reviews.

Instructions to Firms | Top

The following instructions are from the AICPA Peer Review Program Manual.

Letters of Response | Top

A firm is required to write a letter of response if the reviewer found deficiencies and the findings are Pass With Deficiencies or Fail. The following are illustrations of letters of response.

Access the AICPA's Frequently Asked Questions (FAQ) publication on Peer Review.  It answers your questions about enrollment, general information, information for enrolled firms, choosing a peer reviewer, preparing for the review, having the review, the report types, peer review committee consideration and acceptance and other matters.