Providing Additional Auditor Reporting for Clients

Last Revision: 1/1/2022

We understand there is a trend by various third parties, including regulators, to request additional reporting by practitioners on certain items or matters as well as the historical financial statements. This highlights that CPAs, as trusted independent professionals, are well positioned to provide clients and third parties with services outside of the traditional offerings of audit, review, or compilation engagements and we expect these requests for certification or some form of “comfort” will only increase.

The various third-party requests often use terminology that does not clearly match with the standards in the CPA Canada Handbook. They include terms such as “certify,” “agree,” “provide comfort,” “affirm,” or “examine”.  In some instances, the terminology is used without clear guidance on what is expected. For example, these requests might call for procedures such as “confirm reporting is in accordance with agreement/regulation” or “examine in accordance with generally accepted auditing standards”.  Previously, the ability to accept these types of engagements was fairly restrictive under guidance related to derivative reporting. Since the adoption of the Canadian Auditing Standards in 2010, evolvement in Canadian assurance standards has provided the flexibility practitioners need to report on a significant array of financial and non-financial information.  

Additional Reporting by Auditors

Auditors of local governments are keenly aware of such requirements as there are two reports which require the auditor’s signature: one related to the Home Owner Grant and another related to eligible student reporting.

When such requests are received, it is the practitioner’s responsibility to ensure the reporting and the work performed, including documentation, are compliant with the requirements of the appropriate CPA Canada Handbook – Assurance standards. Members should consider how they will report when a request is received to sign a form or document which includes the unusual terminology noted above. In BC, we understand a significant portion of the third parties requesting additional information are provincial bodies or provincially regulated organizations. As such, the reports issued will differ based on the type of information and level of assurance each third party is requesting. The table below includes examples of the most common assurance standards being applied to meet reporting requirements of various third parties.

Examples of the most common assurance standards being applied to meet reporting requirements of various third parties.
CPA Canada Handbook Example of reports

CSAE 3530 Attestation engagements to report on compliance

Eligible student (ES) form reporting; Section 12 of the Independent School Act; Section 2 of the Independent School Regulation

CSRS 4400 Agreed-upon procedures engagements

Accountant’s report for BC Financial Services Authority (formerly Real Estate Council of BC) or Law Society of BC

CAS 805 Special considerations - Audits of single financial statements and specific elements, accounts or items of a financial statement

Common area cost or film tax credit audits;
Home owner grant auditor certificate; statement of per student operating cost (SOPSOC)

Should you be asked to sign any unusual third-party reports please or are unsure which standard could apply to a special reporting engagement, review our Special Reporting Considerations guidance document, or email our Professional Advisory team.

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