At Roger CPA Review, we are not only committed to helping our students successfully pass the CPA Exam, but also to ensuring that all CPA Candidates are educated on all exam-related industry updates. We've done our best to deliver updates & information relating to the Audit Clarity Project changes through our blog and special webcast presentation, and now we're taking it a step further.
You asked, and we listened! Without further ado, here is a summary of the Project Clarity changes that will take effect on July 1, 2013, and a sample Audit Report with the new standards - straight from our course. Enjoy!
2013 Audit Clarity Project Summary of Changes due on CPA Exam 7/1/2013
- Almost every standard has been re-written in the clarity format, making this the most comprehensive change to auditing standards in decade
- The clarity standards add several new requirements that auditors will have to meet in order to comply with generally accepted auditing standards
- The clarity standards introduce new terminology that will be important for candidates to learn
- The clarity standards make significant changes to audit reports
- Unmodified report (old name was unqualified report) for Non-public companies/non-issuers. Now 4 paragraphs – see below.
- Report for Public companies (issuers) is similar to old Audit report – (3 paragraphs)
- Extra paragraphs are now called Emphasis-of-Matter and Other Matter paragraphs (previously called explanatory paragraphs).
- Division of Responsibility now called Group Financial Statements.
- Qualified opinions now called Modified opinions (Qualified except for, Disclaimer and Adverse).