This Audit Guide provides guidance to service auditors engaged to issue reports on a service organization’s controls and to user auditors engaged to audit the financial statements of entities that use service organizations. Many entities use outside service organizations to accomplish tasks that affect the entity’s financial statements. Service organizations provide services ranging from performing a specific task under the direction of an entity to replacing entire business units or functions of an entity. Updated with conforming changes as of March 1, 2008, this guide includes guidance on the risk assessment standards (SAS Nos. 104-111). This edition of the guide has also been conformed to reflect the Defining Professional Requirements standard (SAS No. 102).
The guide summarizes applicable requirements and practices, and delivers "how-to" advice for handling audit issues common to Service Organizations. The appendices include examples of service auditors’ reports, an illustrative representation letter for a service auditor’s engagement, and an entire re-print of AU section 324, Service Organizations (AICPA, Professional Standards), AU section 324 (AICPA, PCAOB Standards and Related Rules, PCAOB Standards, As Amended), AU Section 9324, Service Organizations: Auditing Interpretations of Section 324 (AICPA, Professional Standards), and AU section 9324 (AICPA, PCAOB Standards and Related Rules, PCAOB Standards, As Amended).
For a topical listing of subject matter by chapter, click on the Table of Contents tab.
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This AICPA Audit Guide was prepared by the AICPA SAS No. 70 Task Force to assist auditors in applying generally accepted auditing standards in audits of financial statements of entities that use service organizations and in service auditors' engagements. The AICPA's Auditing Standards Board (ASB) has found the descriptions of auditing standards, procedures, and practices in this Audit Guide to be consistent with existing standards covered by Rule 202, Compliance With Standards (AICPA, Professional Standards, vol. 2, ET sec. 202), and Rule 203, Accounting Principles (AICPA, Professional Standards, vol. 2, ET sec. 203), of the AICPA Code of Professional Conduct.
Auditing guidance included in an AICPA Audit Guide is an interpretive publication pursuant to AU section 150, Generally Accepted Auditing Standards (AICPA, Professional Standards, vol. 1). Interpretive publications are recommendations on the application of Statements on Auditing Standards (SASs) in specific circumstances, including engagements for entities in specialized industries. An interpretive publication is issued under the authority of the ASB after all ASB members have been provided an opportunity to consider and comment on whether the proposed interpretive publication is consistent with the SASs. The members of the ASB have found this guide to be consistent with existing SASs.
The auditor should be aware of and consider interpretive publications applicable to his or her audit. If an auditor does not apply the auditing guidance included in an applicable interpretive publication, the auditor should be prepared to explain how he or she complied with the SAS provisions addressed by such auditing guidance.
This AICPA Audit Guide, which also contains attestation guidance, is an interpretive publication pursuant to AT section 50, SSAE Hierarchy (AICPA, Professional Standards, vol. 1). Interpretive publications include recommendations on the application of Statements on Standards for Attestation Engagements (SSAEs) in specific circumstances, including engagements for entities in specialized industries. Interpretive publications are issued under the authority of the ASB. The members of the ASB have found this guide to be consistent with the existing SSAEs.
A practitioner should be aware of and consider interpretive publications applicable to his or her attestation engagement. If the practitioner does not apply the guidance included in an applicable AICPA Audit and Accounting Guide, the practitioner should be prepared to explain how he or she complied with the SSAE provisions addressed by such guidance.
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