VANCOUVER – With the release of the new Canadian Standard on Related Services (CSSC) 4200, Compilation Engagements, Canadian accounting firms should soon develop a formal implementation plan. But don’t get started yet! Here are my top three tips Canadian accountants should consider before you jump in and get started.
# 1. Read the Basis of Findings.
As with all new standards, this is an obvious suggestion. However, I don’t recommend starting with the new standard itself. I always start with the Base for Conclusions document that was released and can be found on FRASCanada.com or in your CPA Canada Knotia subscription. This is the document that outlines the fundamental purpose of change and addresses all of the areas of contention that have been addressed and responded to. Once you understand the basis for conclusions, you will have a better basis to examine the new standard itself, CSRS 4200.
# 2. Know who you are.
Then I would take the time to think about the current and future services of your business. With the new scope requirements, in Clearline Consulting’s opinion, the most significant change from the current standard, Section 9200, Compile Engagements, I recommend that you think about what services you are actually providing to your clients. clients.
Are you a full-service traditional compilation / tax firm? Are you an outside accountant who assists clients with bookkeeping with or without providing tax return services? Perhaps you are a company tax return firm (T2 commitments only)? It will be of critical importance to ensure that each assignment you provide is clearly defined, adequately resourced, and that appropriate practice risk management measures are in place.
# 3. Do not wait !
My third suggestion follows the steps of my first. With an effective date for fiscal years ending on or after December 14, 2021, you might feel like you have time. I don’t think you do.
A little simple math will help. Clearline CPA has over 700 compilation engagements. If we use my estimate of the average conversion time per file, that’s 2,100 hours that we need to find. Even though we are now a 40+ person company, we don’t have those hours in the schedule from February to June 2022, where the majority of the workload is likely to land.
If you want to get started, see my previous article, “The new CSRS 4200, Compilation Engagements. Too much work ? For our three-phase approach. As with all new standards, this process is about change management – not determining new rules and waiting for new checklists to be released.
The new CSRS 4200 accounting standard will have the biggest impact on Canadian accounting firms since the July 2017 announcement of major tax reform – and the profession knows it. The resources are available now, two years before we start working with the new standard on a daily basis. If you would like us to keep you informed, subscribe to our public practice newsletter here.
Bridget Noonan, CPA, CA, is a partner at Clearline CPA and Clearline Consulting, Who provides practitioners and their staff with the tools, training and guidance they need to succeed and build successful accounting firms. To receive our public practice newsletter, visit our website or provide your contact details here.