The American Institute of CPAs’ (AICPA) Accounting and Review Services Committee (ARSC) has issued a clarification regarding the standard for financial statement preparation within client advisory services (CAS) engagements.
The Statement on Standards for Accounting and Review Services (SSARS) No. 27 is titled “Applicability of AR-C Section 70 to Financial Statements Prepared as Part of a Consulting Services Engagement.”
It specifies that CPAs are not mandated to apply AR-C Section 70 when the preparation of financial statements is not the primary objective of a consulting services engagement, as defined by CS section 100.
The committee notes that CAS, which includes controllership and CFO services, have witnessed a surge in demand.
In assessing the need for clarification, the ARSC concluded that financial statements produced under CS section 100 engagements do not pose a risk to users.
The update clarifies that while the application of AR-C section 70 is not compulsory, accountants are still permitted to apply it fully or partially at their discretion.
AICPA Public Accounting CEO Sue Coffey said: “Our goal is to ensure that accountants have the necessary knowledge, tools and resources to serve their clients efficiently and to the best of their ability.
“As CAS grows as a service area, natural questions arise as to how to best apply certain standards. Clarifying these standards allows accounting professionals providing these valuable services to do so confidently.”
Earlier in March 2025, the AICPA collaborated with the California Society of CPAs to request more precise guidance on California’s climate risk disclosure regulations.
In a comment letter to the California Air Resources Board, it stressed the importance of clear guidelines for implementation and compliance, particularly in the first year of these disclosures.
The AICPA formulates ethical standards for its members and US auditing standards for private companies.
