Plan Fiduciaries and SAS 119
AICPA Statement on Audit Standards (SAS) 119 Requirements
- It requires plan fiduciaries to take responsibility for supplementary information contained in the plan’s financial statements, as part of the engagement letter that the plan signs with its auditor.
- It requires plan fiduciaries to provide an opinion on the fair presentation of supplementary information included in the audited financial statements, as part of management’s signed representation letter to the auditor.
- It requires auditors to more clearly articulate management’s responsibility and their responsibility for supplementary information, as included in the independent auditors’ report to the financial statements.
SAS 119 reminds both auditors and plan fiduciaries of their responsibility with respect to the audited financial statements. Accordingly, plan sponsors are well advised to have appropriate internal controls over financial reporting.
In addition, because the overall quality of the underlying audit engagement and the audited financial statements are ultimately the responsibility of plan management, management should discuss with their auditors whether they are complying with these new audit requirements.
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Author: Dave Dacey | [email protected]
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