Part I by Paul Thompson, Deputy Director, SME & SMP Affairs, explores the challenges currently faced by SMPs, provides regulators' observations, and offers tips for audit efficiency.

Part II  with IFAC SMP Committee Member Christina Foo covers global insights, general implications for SMPs, new service offerings, and practice management. 

The SMP Committee submitted this comment letter on the International Auditing and Assurance Standards Board's Proposed Strategy for 2015-2019 and Proposed Work Program for 2015-2016.

Keeping up with standards and regulation is the biggest challenge facing SMPs. Mats Olsson, Member, IFAC Small and Medium Practices Committee, presents this and additional insights from the IFAC SMP Quick Poll, in addition to tips for audit efficiency, at the KibR Seminar in Warsaw on November 7, 2013.

Los contadores profesionales en empresas son usualmente considerados como asesores de negocios confiables. Esta relación surge de su amplia y significativa experiencia, combinada con un conocimiento detallado de los negocios de sus clientes, lo cual en gran parte se obtiene de los encargos de aseguramiento realizados en los estados financieros de sus clientes. Los contadores profesionales se encuentran en una posición única para agregar valor ya que pueden potenciar la credibilidad de los estados financieros de sus clientes y proporcionarles asesoría de negocios personalizada.

El Consejo de Normas Internacionales de Auditoría y Aseguramiento (IAASB) ha emitido el documento Estándar Internacional de Encargos de Revisión (ISRE) 2400 (revisado), Encargos de revisión de estados financieros históricos,, el cual se encuentra vigente para los periodos que finalizaron en o después de diciembre 31, 2013. Los encargos de revisión proporcionan una forma limitada de aseguramiento sobre los estados financieros históricos y pueden ser una alternativa rentable y de valor agregado cuando no se requiere una auditoría.

Agregando valor rentable para los clientes

La revisión, la cual consiste principalmente en investigación y análisis, se basa en el entendimiento del contador profesional frente a la entidad y su entorno y el marco de información financiera aplicable, según el cual son preparados los estados financieros. Este entendimiento incluye factores relevantes industriales, regulatorios y demás factores externos; la estructura de las operaciones de la entidad, la propiedad y el gobierno; y sus sistemas y registros contables. El contador profesional utiliza este conocimiento para diseñar y realizar procedimientos de investigación y análisis en rubros materiales en los estados financieros y rubros donde es probable que surjan errores materiales. Durante el encargo, el profesional desarrolla un entendimiento significativo del cliente y su negocio, lo que le otorga una excelente oportunidad de ofrecer valor adicional al cliente a través de la provisión de una asesoría personalizada.

Los profesionales pueden proporcionar servicios de revisión de manera más eficiente al componer el grupo de auditoría de profesionales con habilidades y técnicas de aseguramiento, acudiendo a los mismos miembros y utilizando la tecnología para automatizar los mecanismos de la revisión, donde sea posible. Dado que gran parte de la revisión consiste en una comunicación efectiva con los clientes, es preferible realizar una proporción significativa del trabajo en las oficinas del cliente.

Agregando un nivel considerable de aseguramiento a los estados financieros

Según el ISRE 2400 (revisado), el contrato de revisión no es únicamente para que los profesionales obtengan un conocimiento de sus clientes a través de preguntas y análisis; el contrato requiere que el contador vaya más allá y obtenga evidencia adicional si se determina que puede existir un error material en los estados financieros.  Se requieren igualmente procedimientos adicionales cuando surgen más dudas, por ejemplo si las transacciones de partes relacionadas se categorizan fuera del curso normal del negocio, sospechas de fraude o no cumplimiento con las leyes o regulaciones, o dudas sobre la capacidad de la entidad de continuar como un negocio en marcha. Este esfuerzo adicional permite lograr el nivel significativo y valioso de aseguramiento indicado por la conclusión de revisión.

Bajo el ISRE 2400 (revisado), el profesional debe cumplir con los requerimientos éticos relevantes, incluyendo aquellos relacionados con la independencia en el Código de ética para contadores profesionales del Consejo de Normas Internacionales de Ética para Contadores (Código IESBA), o los requerimientos nacionales equivalentes que son por lo menos igual de restrictivos. El estándar de revisión requiere igualmente que los contadores profesionales ejerzan el juicio profesional y sean escépticos a lo largo del contrato.

Beneficios para todas las partes involucradas

En resumen, existen beneficios para todas las partes involucradas en un contrato de revisión del ISRE 2400 (revisado). Los profesionales obtendrán la base de conocimiento que les permitirá agregar valor a los negocios de sus clientes, expresando simultáneamente las conclusiones de aseguramiento necesarias en los estados financieros anuales. Los clientes y demás usuarios de los estados financieros contarán con un nivel significativo de aseguramiento proporcionado por un contador profesional objetivo e independiente.

Una guía de revisiones para contadores profesionales y organismos miembros de la IFAC

La guía más reciente del Comité SMP de la IFAC, la Guía de contratos de revisión, tiene como objetivo brindar una ayuda a las organizaciones miembro de la IFAC y sus miembros en firmas, en particular firmas pequeñas y medianas (SMP), frente a la implementación del ISRE 2400 (revisado). Para permitir a los contadores profesionales desarrollar un entendimiento más profundo del contrato de revisión llevado a cabo en cumplimiento con el estándar, la guía incluye ejemplos ilustrativos junto con extractos relevantes del estándar.  Incluye igualmente puntos prácticos para consideración de los profesionales, tips sobre cómo implementar eficientemente el estándar y listas de verificación y formatos que los contadores profesionales deben adaptar para cumplir con los requerimientos y circunstancias en su jurisdicción.

Recursos IFAC

Puede visitar el área SMP del sitio web de la IFAC, www.ifac.org/SMP, para acceder a esta guía y guías adicionales del Comité SMP, conocer más sobre las actividades del Comité y suscribirse al eNews SMP. Si bien la guía incluye extractos relevantes del ISRE 2400 (revisado), el estándar completo se encuentra disponible en el Manual 2013 del IAASB (ver igualmente la publicación At a Glance.

• Guía de los contratos de revisión

Artículos adicionales:

• Encargos de Revisión para PYMES: Aseguramiento limitado, Numerosos beneficios
• El estándar para contratos de revisión de aseguramiento limitado

¡Únete al debate y mantente informado! Puedes seguir al Comité SMP en Twitter (@IFAC­_SMP) y LinkedIn (IFAC SMP Community). Puedes encontrar recursos relevantes adicionales bajo la categoría Audit & Assurance (auditoría & aseguramiento), a partir de abril 2014, en la sección IFAC Global Knowledge Gateway.

Translated by the Instituto Nacional de Contadores Públicos (Colombia).

The SMP Committee submitted this comment letter on the International Ethics Standards Board for Accountants (IESBA)'s Consultation Paper: Proposed Strategy and Work Plan, 2014-2018.

Note to Editors: This article is available for IFAC member organizations to publish in their journals and/or websites. Email permissions@ifac.org for access and copyright information.

Professional accountants in practice are frequently looked upon as trusted business advisors. This relationship stems from their significant breadth of business experience combined with detailed knowledge of their clients’ businesses, much of which is obtained in the process of performing assurance engagements on their clients’ financial statements. Professional accountants are therefore in a unique position to add value, both in terms of enhancing the credibility of their clients’ financial statements and being able to provide them with tailored business advice.

The International Auditing and Assurance Standards Board (IAASB) has issued International Standard on Review Engagements (ISRE) 2400 (Revised), Engagements to Review Historical Financial Statements, which is now effective for periods ended on or after December 31, 2013. Review engagements provide a limited form of assurance on historical financial statements and may be a cost effective and value-adding alternative when an audit is not required.

Adding Cost-Effective Value to Clients

A review, consisting primarily of inquiry and analysis, is based on the professional accountant’s understanding of the entity and its environment and the applicable financial reporting framework according to which the financial statements are prepared. This understanding includes relevant industry, regulatory, and other external factors; the entity’s operations, ownership, and governance structure; how it is financed; and its accounting systems and records. The professional accountant uses this knowledge to design and perform inquiry and analytical procedures on both material items in the financial statements and on those items where material misstatements are likely to arise. In the course of the engagement, the practitioner develops a significant understanding of the client and its business, which gives him/her an excellent opportunity to offer additional value to the client through the provision of bespoke advice.

Practitioners can provide review services most efficiently by staffing a review engagement with professionals competent in assurance skills and techniques, consistently using the same staff members, and making use of technology to automate the mechanics of the engagement wherever possible. As so much of a review consists of effective communication with clients, performing a significant proportion of the work at the client’s place of business is preferable.

Adding a Meaningful Level of Assurance to Financial Statements

In accordance with ISRE 2400 (Revised), a review engagement is not just about practitioners obtaining knowledge of their clients through questions and analysis; it also requires the accountant to dig deeper and obtain additional evidence if it is determined there may be a material misstatement in the financial statements. Additional procedures are also required when further questions arise, such as if related party transactions fall outside the normal course of business, fraud or non-compliance with laws or regulations is suspected, or doubts arise regarding the entity’s ability to continue as a going concern. This additional work effort allows for the meaningful and valuable level of assurance conveyed by the review conclusion.

Under ISRE 2400 (Revised), the practitioner is required to comply with relevant ethical requirements, including those pertaining to independence in the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code), or national equivalent requirements that are at least as restrictive. The review standard also requires professional accountants to exercise professional judgment and to be skeptical throughout the engagement.

Benefits for All Parties Involved

In summary, there are benefits for all parties involved in an ISRE 2400 (Revised) review engagement. Practitioners will obtain the knowledge base to enable them to add value to their clients’ businesses while expressing the assurance conclusions needed on annual financial statements. Clients and other financial statements users will have the comfort of a meaningful level of assurance provided by an objective and independent professional accountant.

A Guide to Reviews for Practitioners and IFAC Member Bodies

The newest guide from the IFAC SMP Committee, the Guide to Review Engagements, is intended to help IFAC member organizations and their members in practice, especially small- and medium-sized practices (SMPs), with the implementation of ISRE 2400 (Revised). To help practitioners develop a deeper understanding of a review engagement conducted in compliance with the standard, the guide includes illustrative examples alongside relevant extracts from the standard. It also includes practical points for practitioners’ consideration, tips on how to efficiently implement the standard, and checklists and forms that practitioners can adapt to meet the requirements and circumstances in their particular jurisdiction.

IFAC Resources

Visit the SMP area of the IFAC website to access this and other guides. While the guide includes relevant extracts from ISRE 2400 (Revised), the complete standard is available in the 2013 IAASB Handbook (see also the At a Glance).

• Guide to Review Engagements

Additional articles:

• Review Engagements for SMEs: Limited Assurance, Numerous Benefits
• The Standard for Limited Assurance Review Engagements

Join the discussion and stay informed! Follow the SMP Committee on Twitter (@IFAC­_SMP) and LinkedIn (IFAC SMP Community). Look for additional relevant resources under Audit & Assurance, coming in April 2014 to the IFAC Global Knowledge Gateway.

Andreas Noodt, member, IFAC Small and Medium Practices Committee, speaks at FEE & ICAEW Event about the SMP Commitee's Guide to Review Engagements. The Guide, published in December 2013, aims to provide implementation support for practitioners in conducting review engagements in compliance with International Standard on Review Engagements (ISRE) 2400 (Revised). 

This report provides a summary and, where appropriate, analysis and commentary including possible limitations of the data from the poll conducted November 15-December 31, 2013. This edition of the poll received 3,709 responses and was conducted in 17 languages.

The most recent IFAC SMP Quick Poll of small- and medium-sized accounting practices (SMPs) indicated that fewer of their small business clients are burdened by economic uncertainty, perhaps suggesting a more favorable economic climate and signaling future growth in this sector.

“Over the last few years, economic uncertainty has cast a shadow over SMPs and their clients,” commented SMP Committee Chair Giancarlo Attolini. “Improving conditions in the small business sector, a barometer for economic growth, are a terrific sign for SMP professionals and for the economy at large. As their clients prepare for growth, SMPs will, in turn, also help propel the local economies in which they operate.”

When asked for input regarding the International Auditing and Assurance Standards Board’s 2013 Auditor Reporting Exposure Draft, which proposed significant changes to auditor reporting, respondents were generally supportive. While only a small minority thought unlisted entities would voluntarily opt to disclose key audit matters, most agreed with the proposal to require a statement on going concern in all audit reports.

The poll also shed light on the value of various services and projections for their relative growth. Accounting compilation and other non-assurance/related services proved to be the fastest growing sources of revenue for SMPs, by a significant margin, over audit and assurance. Roughly half of the respondents acknowledged the value of integrated reporting to small- and medium-sized entities (SMEs), and about half predict that within five years, SME clients will ask for assistance with integrated reporting.

For additional findings and a complete summary of results, see the IFAC SMP Quick Poll, 2013 Year-End Round-Up in the SMP Committee area of the IFAC site: www.ifac.org/SMP. Due to unbalanced response rates by region, results may not be statistically representative of global or regional populations of SMPs.

The year-end 2013 poll received 3,709 responses and was conducted in 17 languages from November 15 to December 31. The poll is intended to take a snapshot of key challenges and trends influencing SMPs globally. IFAC wishes to thank the many member and regional organizations that helped with translation and distribution of the poll.

About the SMP Committee
The SMP Committee of the International Federation of Accountants (IFAC) represents the interests of professional accountants operating in small- and medium-sized practices (SMPs). The committee develops guidance and tools and works to ensure the needs of the SMPs are considered by standard setters, regulators, and policy makers. The committee also speaks out on behalf of SMPs to raise awareness of their role and value, especially in supporting SMEs, and the importance of the small business sector overall.

About IFAC
IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 179 members and associates in 130 countries and jurisdictions, representing approximately 2.5 million accountants in public practice, education, government service, industry, and commerce.

The SMP Committee submitted this comment letter on the International Auditing and Assurance Standards Board (IAASB)'s Auditor Reporting Exposure Draft.