AICPA Provides Guidance on Peer Reviews of Firms That Perform SEC-Registered Broker-Dealer Audits
For peer reviews commencing on or after July 1, 2021, audits and the related compliance and exemption engagements for SEC-registered broker-dealers are no longer included in the scope of peer review; however, there is still an impact on peer reviews of firms that perform these types of engagements. These firms’ peer reviews need to be administered by the National Peer Review Committee as they performed engagements under PCAOB Standards. In its February 2022 “Reviewer alert” newsletter, the American Institute of CPAs (AICPA) outlined the following impacts:
Firm - PRI:
- Only include levels of service and types of engagements that are in the scope of peer review
- Answer the PCAOB question relating to the Form 2 – if a Form 2 was filed with the PCAOB with broker-dealers, then the applicable questions should be answered yes
- Include Securities Investor Protection Corporation (SIPC) agreed-upon procedures engagements (if performed) related to the broker-dealers audits as these are in the scope of peer review
Reviewer:
- Inquire if the PCAOB has inspected their broker-dealer engagements and document in the SRM if there are any findings, if those findings are applicable to engagements subject to peer review and any impacts on peer review procedures
- Select a SIPC AUP engagement depending on the risk assessment; if one is reviewed, then complete checklist 21,300 Supplemental Checklist for Review of Agreed-Upon Procedures Related to the SIPC Assessment Reconciliation for Broker Dealers (updated October 2021 to only apply to the SIPC AUP engagement) and the applicable 20,900 agreed-upon procedures checklist
- Include “applicable to engagements not subject to PCAOB permanent inspection” language in the first and last paragraphs in the peer review report