The Auditing Standards Board (ASB) has voted to adopt Statement on Auditing Standards, Forming an Opinion and Reporting on Financial Statements of Employee Benefit Plans Subject to ERISA as a final standard.
Proposed in April 2017, the SAS addresses the auditor’s responsibilities to form an opinion and report on the financial statements of Employee Retirement Income Security Act (ERISA) plans, and the form and content of such reporting, including reporting on specific plan provisions relating to the ERISA plan financial statements and reporting when management imposes a limitation on the scope of the audit in accordance with ERISA section 103(a)(3)(C).
Proposed amendments included:
- Engagement acceptance requirements in addition to AU-C section 210;
- New performance requirements that serve as a basis for a new reporting requirement, “Report on Specific Plan Provisions Relating to the Financial Statements;”
- New required procedures when the ERISA-permitted audit scope limitation is imposed;
- Written management representations in addition to AU-C section 580;
- Considerations relating to the Form 5500 filing, which the auditor’s report accompanies;
- Expanded description of management’s responsibilities;
- Expanded communication on the ERISA supplemental schedules;
- New form and content requirements of the auditor’s report when management instructs the auditor to limit the scope of the audit, as permitted by ERISA, including expanded auditor’s responsibilities relating to the certified information; and
- Required emphasis-of-matter paragraphs.
Although the ASB has voted to issue this SAS as a final standard, it expects to consider whether conforming amendments to this SAS will be necessary once the Proposed Statements on Auditing Standards Auditor Reporting and Related Amendments are voted to be issued, which is expected to occur in the first half of 2019.
When issued, it is expected to be effective no earlier than for audits of financial statements for periods ending on or after December 15, 2020.For more information, or to speak with a staff expert, contact Jackie Hyland at firstname.lastname@example.org or 919-490-4387.
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