Client Memo

Topics: Certified Public Accountant, Audit, Financial audit Pages: 2 (521 words) Published: April 29, 2012
SAS 115 Changes and Benefits

April 23, 2012

SAS 115 Changes and Benefits
TO: Valued Clients
DATE: April 23, 2012
SUBJECT: SAS 115 Changes and Benefits
CC: Supervisor

Dear Valued Client,
In a recent move toward improving company communications pertaining to internal control matters it has been brought to our attention in this effort to provide the best service for clients Statement on Auditing Standards (SAS) No. 112 has been removed and replaced with SAS 115, which is in effect for audits being performed on or after December 15, 2009. Definitions

Internal control is the method put into place by a company to be sure the integrity of financial and accounting information, meets operational, profitability targets, and transmit management policies throughout the organization (Investopedia). Control deficiency is the result of the design or operation of the control not allowing management, employees to prevent, or correct financial misstatements (Ken Plessner CPA). Material weakness occurs with the possibility of the material misstatement not being prevented, detected, and corrected on a timely basis (Ken Plessner CPA). Significant deficiency requires attention by those in charge but is not as severe as material weakness (Ken Plessner CPA). SAS 115 allows the practitioners to more effectively use their judgment when they become aware of and determine the severity of the deficiency found. If it is determined the deficiency is severe enough, they will report it in writing, to management, and administration (Ken Plessner CPA). Benefits of the changes

As with SAS 112, SAS 115 promotes clients understanding of their organization’s internal control weaknesses, which can benefit them in several ways, including (Thomas J. Ryan): * Written communication clarifies identified deficiencies determined to be significant or material weaknesses so management can weigh the risks and determine how they will be...

Cited: Investopedia. (n.d.). Retrieved from Investopedia Dictionary:
Ken Plessner CPA, M. (n.d.). Communicating Internal Control Matters - SAS NO. 115. Retrieved from Eisneramper Accountants and Advisors:
Thomas J. Ryan, C. C. (n.d.). Time to Start Thinking about Implementing SAS 115. Retrieved from Pennsylvania Insitute of Certified Public Accountants:
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Novel Analysis: The Client Essay
  • Client Server Architecture Essay
  • Client and Server Essay
  • Client Server Architecture Essay
  • Client Server Architecture: Questionnaire Essay
  • Client-server and Single Subject Area Essay
  • Networking
  • Essay about Client/Server Architecture and Attributes

Become a StudyMode Member

Sign Up - It's Free