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COntinued
standards
CFAS Guide Issued
Guide for Registered Auditors:
Engagements on Attorneys Trust
Accounts
The long awaited
Guide for
Registered Auditors: Engagements on
Attorneys Trust Accounts
(the Guide)
was prepared by a Task Group of
the Committee for Auditing Standards
(CFAS) of the IRBA which comprised
auditors and representatives of the
Law Society of South Africa, the
Provincial Law Societies and the
Attorneys Fidelity Fund. The Guide,
which is authoritative, was approved
for issue by the IRBA Board in
February 2014 and replaces the
previous SAICA Guide
Guidance for
Auditors: The Audit of Attorneys’ Trust
Accounts in terms of the Attorneys
Act, No 53 of 1979, and applicable
Rules of the Provincial Law Societies
which has been withdrawn.
Effective date:
The Guide is effective
for engagements commencing on or
after 1 March 2014.
Guidance is provided to registered
auditors in the special circumstances
applicable to engagements on
attorneys trust accounts as required
by the Attorneys Act, No 53 of 1979
and Rules of the relevant Provincial
Law Society (the Act and the Rules),
including an auditor’s responsibility to
report a reportable irregularity. The
Guide is also relevant for attorneys
in understanding the nature of the
engagement, and the respective
responsibilities of the parties, which
will be communicated to attorneys by
the relevant Provincial Law Societies.
There is an expectation by the
Attorneys Fidelity Fund, the Law
Societies, financial institutions,
attorneys’ clients and members of
the public, that auditors of attorneys
trust accounts will detect fraud and
theft, whereas the main purpose of
an engagement on an attorney’s
trust accounts is for the auditor to
evaluate the compliance of attorneys
trust accounts with the Act and Rules.
Accordingly the Guide contains
special considerations applicable to
fraud and theft in the circumstances
of engagements on attorneys trust
accounts.
This Guide introduces the new
Attorney’s Annual Statement
on Trust Accounts
which
contains the attorney’s compliance
representations to the relevant
Provincial Law Society, and
information extracted from the trust
accounting records previously dealt
with in the auditor’s report. The
Attorney’s Annual Statement on
Trust Accounts is to accompany the
auditor’s report.
The following appendices are
included to assist auditors:
•
a table setting out the existing
requirements in the Act and
the individual Provincial Law
Societies’ Rules, identified
assurance engagement risk and
illustrative responses to assessed
assurance engagement risk.
The Rules will be updated with
reference to the Uniform Rules,
once issued by the Law Society of
South Africa;
•
an illustrative auditor’s
engagement letter;
•
an illustrative attorney’s
representation letter to the
auditor;
•
illustrative auditor’s unmodified
and qualified reports; and
•
the
Attorney’s Annual
Statement on Trust Accounts
for completion by the attorney
that is to accompany the auditor’s
report submitted to the relevant
Provincial Law Society from 2014
onwards.
The
Guide for Registered Auditors:
Engagements on Attorneys Trust
Accounts
was issued on
28 February 2014 and may be
downloaded in both Word and PDF
Format from the IRBA website:
www.
irba.co.za.
CFAS Regulated Industries
and Reports Standing
Committee (RIRSC)
Auditing pronouncements
finalised and issued
SAAPS 2 (Revised November 2013)
Financial Reporting Frameworks
and the Auditor’s Report and
SAAPS 3 (Revised November 2013)
Illustrative Reports
The South African Auditing Practice
Statements (SAAPS): SAAPS 2
(Revised November 2013),
Financial
Reporting Frameworks and the
Auditor’s Report
and SAAPS 3
(Revised November 2013),
Illustrative
Reports,
were revised by the
CFAS and approved for issue in
November 2013.
SAAPS 2 (Revised November 2013)
SAAPS 2 (Revised November 2013)
contains conforming amendments
arising from the withdrawal of
the South African Statements of
Generally Accepted Accounting
Practice (SA GAAP) from
1 December 2012 and the
issue of the Accounting
Standards Board (ASB)
Directive 5 Appendix I.