Why Your Independence Might Be Impaired (By Nonattest Services)

Maintaining independence while providing nonattest services

A CPA’s independence can be impaired by performing nonattest services. 

Cause of Independence Impairment

The AICPA Code of Conduct requires that clients accept responsibility for nonattest services if attest services are also provided. Why? If the client has no one to assume responsibility (for the nonattest work), then the auditor could be performing management responsibilities that impair independence.

Nonattest Examples

What are some examples of nonattest services?

Documentation of SKE

The client should appoint someone with appropriate skill, knowledge, and experience (sometimes referred to as SKE) to oversee nonattest services provided by the public accounting firm. The CPA firm should document their consideration of independence — usually in the enagagement letter and/or a memorandum. Document the nonattest services to be provided and the client personnel overseeing the work. It is helpful to also document the skill, knowledge, and experience of the designated person. What is their educational background? How long have they served in their role? Do they have any certifications (e.g., CPA, CISA)? What qualifies the designated (client) person to oversee the nonattest service performed by the attest firm?

AICPA independence

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