Clarified Statements on Auditing Standards
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The Auditing Standards Board (ASB) has redrafted all of the auditing sections in Codification of Statements on Auditing Standards (contained in AICPA Professional Standards). These sections now reflect the ASB’s established clarity drafting conventions designed to make the standards easier to read, understand, and apply.
Among other improvements, generally accepted auditing standards (GAAS) now more clearly states the objectives of the auditor and the requirements with which the auditor has to comply when conducting an audit in accordance with GAAS.
As the ASB redrafted the standards for clarity, it also converged the standards with the International Standards on Auditing (ISAs), issued by the International Auditing and Assurance Standards Board (IAASB). Although the purpose of redrafting the auditing standards is for clarity and convergence and not to create additional requirements, auditors will need to make some adjustments to their practices as a result of this project.
The AICPA developed a Learning and Implementation Plan to prepare for the transition, as well as additional information, including transition guidance and training, located in the Financial Reporting Center.
As part of the clarity project, the "AU-C" identifier was established to avoid confusion with references to existing "AU" sections. The "AU-C" identifier had been scheduled to revert back to the AU identifier at the end of 2013, by which time the previous sections would be superseded for all engagements. However, in response to user requests, the AU-C identifier will be retained indefinitely. The superseded AU sections were removed from Professional Standards at the end of 2013, as scheduled.
The ASB has completed the Clarity Project with the issuance of SAS No. 128, Using the Work of Internal Auditors, which is effective for audits of financial statements for periods ending on or after December 15, 2014.
Original Standard No. |
Title & synopsis |
Section in Professional Standards |
Interpretations (if applicable) |
SAS No. 122
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Overall Objectives of the Independent Auditor and the Conduct of an Audit in Accordance With Generally Accepted Auditing Standards |
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Terms of Engagement |
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Quality Control for an Engagement Conducted in Accordance With Generally Accepted Auditing Standards |
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Audit Documentation |
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Consideration of Fraud in a Financial Statement Audit |
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Consideration of Laws and Regulations in an Audit of Financial Statements |
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The Auditor’s Communication With Those Charged With Governance |
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Communicating Internal Control Related Matters Identified in an Audit |
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Planning an Audit |
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Understanding the Entity and Its Environment and Assessing the Risks of Material Misstatement |
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Materiality in Planning and Performing an Audit |
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Performing Audit Procedures in Response to Assessed Risks and Evaluating the Audit Evidence Obtained |
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Audit Considerations Relating to an Entity Using a Service Organization |
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Evaluation of Misstatements Identified During the Audit |
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Audit Evidence |
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Audit Evidence—Specific Considerations for Selected Items |
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External Confirmations |
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Opening Balances—Initial Audit Engagements, Including Reaudit Engagements |
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Analytical Procedures |
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Audit Sampling |
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Auditing Accounting Estimates, Including Fair Value Accounting Estimates, and Related Disclosures |
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Related Parties |
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Subsequent Events and Subsequently Discovered Facts |
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Written Representations |
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Consideration of Omitted Procedures After the Report Release Date |
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Special Considerations—Audits of Group Financial Statements (Including the Work of Component Auditors) |
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Using the Work of an Auditor’s Specialist |
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Forming an Opinion and Reporting on Financial Statements This section addresses the auditor’s responsibility to form an opinion on the financial statements. It also addresses the form and content of the auditor’s report issued as a result of an audit of financial statements. |
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Modifications to the Opinion in the Independent Auditor’s Report This section addresses the auditor’s responsibility to issue an appropriate report in circumstances when, in forming an opinion in accordance with AU-C section 700A, the auditor concludes that a modification to the auditor’s opinion on the financial statements is necessary. |
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Emphasis-of-Matter Paragraphs and Other-Matter Paragraphs in the Independent Auditor’s Report This section addresses additional communications in the auditor’s report when the auditor considers it necessary to draw users’ attention to a matter or matters presented or disclosed in the financial statements that are of such importance that they are fundamental to users’ understanding of the financial statements (emphasis-of-matter paragraph) or draw users’ attention to any matter or matters other than those presented or disclosed in the financial statements that are relevant to users’ understanding of the audit, the auditor’s responsibilities, or the auditor’s report (other-matter paragraph). |
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Consistency of Financial Statements |
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Other Information in Documents Containing Audited Financial Statements This section addresses the auditor’s responsibility with respect to other information in documents containing audited financial statements and the auditor’s report thereon. In the absence of any separate requirement in the particular circumstances of the engagement, the auditor’s opinion on the financial statements does not cover other information, and the auditor has no responsibility for determining whether such information is properly stated. This section establishes the requirement for the auditor to read the other information of which the auditor is aware because the credibility of the audited financial statements may be undermined by material inconsistencies between the audited financial statements and other information. |
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Supplementary Information in Relation to the Financial Statements as a Whole |
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Required Supplementary Information |
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Special Considerations—Audits of Financial Statements Prepared in Accordance With Special Purpose Frameworks |
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Special Considerations—Audits of Single Financial Statements and Specific Elements, Accounts, or Items of a Financial Statement |
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Reporting on Compliance With Aspects of Contractual Agreements or Regulatory Requirements in Connection With Audited Financial Statements |
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Engagements to Report on Summary Financial Statements |
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Reports on Application of Requirements of an Applicable Financial Reporting Framework |
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Letters for Underwriters and Certain Other Requesting Parties |
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Filings With the U.S. Securities and Exchange Commission Under the Securities Act of 1933 |
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Interim Financial Information |
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Compliance Audits |
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SAS No. 123 |
Omnibus Statement on Auditing Standards—2011 |
AU-C sec. 200.03 |
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Financial Statements Prepared in Accordance With a Financial Reporting Framework Generally Accepted in Another Country |
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Alert That Restricts the Use of the Auditor's Written Communication |
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Omnibus Statement on Auditing Standards—2013 |
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Using the Work of Internal Auditors |
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Amendment to Statement on Auditing Standards No. 122 Section 920, Letters for Underwriters and Certain Other Requesting Parties, as Amended |
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An Audit of Internal Control Over Financial Reporting That Is Integrated With an Audit of Financial Statements |
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SAS No. 131 |
Amendment to Statement on Auditing Standards No. 122 Section 700A, Forming an Opinion and Reporting on Financial Statements This section addresses the auditor |
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SAS No. 132 |
The Auditor's Consideration of an Entity's Ability to Continue as a Going Concern |
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SAS No. 133 |
Auditor Involvement With Exempt Offering Documents |
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SAS No. 134 |
Auditor Reporting and Amendments, Including Amendments Addressing Disclosures in the Audit of Financial Statements |
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SAS No. 135 |
Omnibus Statement on Auditing Standards — 2019 |
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SAS No. 136 |
Forming an Opinion and Reporting on Financial Statements of Employee Benefit Plans Subject to ERISA |
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SAS No. 137 |
The Auditor’s Responsibilities Relating to Other Information Included in Annual Reports |
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| SAS No. 138 | Amendments to the Description of the Concept of Materiality SAS No. 138 amends various AU-C sections in AICPA Professional Standards, to align the materiality concepts discussed in AICPA Professional Standards with the description of materiality used by the U.S. judicial system, the auditing standards of the PCAOB, the SEC, and the FASB. The ASB believes it is in the public interest to eliminate inconsistencies between AICPA Professional Standards and the description of materiality used by the U.S. judicial system and other U.S. standard setters and regulators. |
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SAS No. 139 |
Amendments to AU-C Sections 800, 805, and 810 to Incorporate Auditor Reporting Changes From SAS No. 134 SAS No. 139 aligns AU-C sections 800, Special Considerations—Audits of Financial Statements Prepared in Accordance With Special Purpose Frameworks, 805, Special Considerations—Audits of Single Financial Statements and Specific Elements, Accounts, or Items of a Financial Statement, and 810, Engagements to Report on Summary Financial Statements, with the reporting provisions of SAS No. 134, Auditor Reporting and Amendments, Including Amendments Addressing Disclosures in the Audit of Financial Statements, and other recently issued SASs. These revised auditor’s reports involving special purpose accounting frameworks and other unique reporting scenarios provide additional transparency into the basis for the auditor’s opinion and the responsibilities of both entity management and auditors. |
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SAS No. 140 |
Amendments to AU-C Sections 725, 730, 930, 935, and 940 to Incorporate Auditor Reporting Changes From SAS Nos. 134 and 137 SAS No. 140 completes the ASB’s yearlong effort to conform GAAS with the reporting provisions of SAS No. 134, Auditor Reporting and Amendments, Including Amendments Addressing Disclosures in the Audit of Financial Statements, and other recently issued SASs. In addition, certain other AU-C sections in AICPA Professional Standards have been amended to reflect practice issues that have arisen since the most recent revisions to these AU-C sections, and AU-C section 935, Compliance Audits, has also been amended to be consistent with current governmental requirements. |
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SAS No. 141 |
Amendment to the Effectiven Dates of SAS Nos. 134-140 SAS No. 141 delays by one year the effective dates of SAS Nos. 134–140 (which, among other things, substantially changes the auditor’s report) from December 15, 2020, to December 15, 2021, and also permits early implementation of this suite of standards. |
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SAS No. 142 |
Audit Evidence The primary focus of SAS No. 142, including its objective, is on considering the attributes and factors of information that contribute to an assessment of whether sufficient appropriate audit evidence has been obtained. This standard is based on the premise that the auditor should evaluate information to be used as audit evidence notwithstanding the source from which it is obtained, or the procedures used to obtain the information. New attributes of information for the auditor to consider include whether the information is corroborative or contradictory to management assertions, the authenticity of the evidence and its susceptibility to bias. |
AU -C sec. 500 | AU -C sec. 9500 |
SAS No. 143 |
Auditing Accounting Estimates and Related Disclosures SAS No. 143 is intended to enable auditors to appropriately address the increasingly complex scenarios that arise today from new accounting standards that include estimates and related disclosures, and to enhance the auditor’s focus on factors driving estimation uncertainty and potential management bias. In our current environment, management’s estimates related to asset impairments are particularly important and this standard will aid auditors in assessing management’s estimates during a period of economic uncertainty and volatility. |
AU -C sec. 540 | |
SAS No. 144 |
Amendments to AU-C Sections 501, 540, and 620 Related to the Use of Specialists and the Use of Pricing Information Obtained From External Information Sources SAS No. 144 addresses certain comments that were received on the exposure draft that resulted in the issuance of SAS No. 143, Auditing Accounting Estimates and Related Disclosures. Among other things, the SAS provides guidance in AU-C section 501, Audit Evidence — Specific Considerations for Selected Items, on applying SAS No. 143 when management has used the work of a specialist in developing accounting estimates, as well as other amendments to enhance guidance about evaluating the work of the management’s specialist. |
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AU -C sec. 9620 |
Recently Issued Clarified SASs and Interpretations
SAS No. 145, Understanding the Entity and Its Environment and Assessing the Risks of Material Misstatement
SAS No. 144, Amendments to AU-C Sections 501, 540, and 620 Related to the Use of Specialists and the Use of Pricing Information Obtained From External Information Sources
SAS No. 143, Auditing Accounting Estimates and Related Disclosures
SAS No. 142, Audit Evidence
SAS No. 141, Amendment to the Effective Dates of SAS Nos. 134–140
SAS No. 140, Amendments to AU-C Sections 725, 730, 930, 935, and 940 to Incorporate Auditor Reporting Changes From SAS Nos. 134 and 137 137 (SAS No. 141 delays the effective date to December 15, 2021, and the Auditing Standards Board recommends that SAS Nos. 134–140 be implemented concurrently)
SAS No. 139, Amendments to AU-C Sections 800, 805, and 810 to Incorporate Auditor Reporting Changes From SAS No. 134 (SAS No. 141 delays the effective date to December 15, 2021, and the Auditing Standards Board recommends that SAS Nos. 134–140 be implemented concurrently)
SAS No. 138, Amendments to the Description of the Concept of Materiality (SAS No. 141 delays the effective date to December 15, 2021, and the Auditing Standards Board recommends that SAS Nos. 134–140 be implemented concurrently)
SAS No. 137, The Auditor’s Responsibilities Relating to Other Information Included in Annual Reports (SAS No. 141 delays the effective date to December 15, 2021, and the Auditing Standards Board recommends that SAS Nos. 134–140 be implemented concurrently)
SAS No. 136, Forming an Opinion and Reporting on Financial Statements of Employee Benefit Plans Subject to ERISA (SAS No. 141 delays the effective date to December 15, 2021, and the Auditing Standards Board recommends that SAS Nos. 134–140 be implemented concurrently)
SAS No. 135, Omnibus Statement on Auditing Standards – 2019 (SAS No. 141 delays the effective date to December 15, 2021, and the Auditing Standards Board recommends that SAS Nos. 134–140 be implemented concurrently)
SAS No. 134, Auditor Reporting and Amendments, Including Amendments Addressing Disclosures in the Audit of Financial Statements (SAS No. 141 delays the effective to December 15, 2021, and the Auditing Standards Board recommends that SAS Nos. 134–140 be implemented concurrently)
Standards Setting Bodies
- Accounting and Review Services Committee
- Auditing Standards Board
- Federal Accounting Standards Advisory Board
- Financial Accounting Standards Board
- Governmental Accounting Standards Board
- Public Company Accounting Oversight Board
- International Accounting Standards Board
- International Auditing and Assurance Standards Board
