How the SSARSs are organized and what AR-C 60 requires on every engagement

• Identify the AR-C sections and which engagement each one governs
• Distinguish unconditional and presumptively mandatory requirements under AR-C 60
• Apply the AR-C 60 acceptance conditions and preconditions before signing an engagement
• Determine which SSARS amendments apply to a given reporting period

Where the SSARSs sit

Statements on Standards for Accounting and Review Services (SSARSs) are issued by the AICPA Accounting and Review Services Committee (ARSC), the senior committee designated to issue pronouncements on preparation, compilation and review engagements for nonissuers. Council has designated ARSC under the Compliance With Standards Rule (ET sec. 1.310.001), so a member who performs a preparation, compilation or review engagement and departs from the SSARSs has a Code problem, not just a quality problem.

SSARS No. 21 (October 2014) clarified and recodified the standards into AR-C 60, 70, 80 and 90. Later statements added AR-C 100 and AR-C 120:

Later standards amend those sections rather than adding new ones. SSARS No. 25 (issued February 2020) added explicit materiality and adverse conclusions to reviews, effective for periods ending on or after December 15, 2021. SSARS No. 26 (June 2022) aligned the AR-C sections with the quality management standards, effective for engagements for periods ending on or after December 15, 2025. SSARS No. 27 (2025) clarified when AR-C 70 applies to financial statements prepared in a consulting engagement, effective for periods ending on or after December 15, 2026. SSARS No. 26 renumbered paragraphs in AR-C 60 (the acceptance paragraph moved from .25 to .30 and the preconditions from .26 to .31), and the earlier text still governs earlier periods, so check the period before you cite a paragraph number. The SSARS update guide walks through each change.

The language of requirements

AR-C 60 uses two categories. "Must" is an unconditional requirement. "Should" is presumptively mandatory: you comply unless, in rare circumstances, the specific procedure would be ineffective, and then AR-C 60 requires alternative procedures that achieve the intent. You must document the justification for the departure and how the alternative procedures were sufficient. AR-C 60 bars you from stating in a compilation or review report that you complied with SSARSs unless you complied with AR-C 60 and every other relevant AR-C section.

AR-C 60 says you must perform a review, compilation or preparation engagement in accordance with SSARSs. The one carve-out is a review of interim financial information that meets the AR-C 90 conditions; that review follows AU-C 930 instead.

Acceptance and preconditions

Under the current text, AR-C 60.30 bars acceptance when you have reason to believe relevant ethical requirements (including independence, where it applies) will not be met, when the information you need is likely to be unavailable or unreliable, or when you doubt management's integrity enough that it is likely to affect the engagement.

AR-C 60.31 then sets the preconditions. You determine that the financial reporting framework management selected is acceptable, and you obtain management's agreement that it acknowledges and understands its responsibility for:

• selecting the framework
• internal control over preparation and fair presentation, unless you accept responsibility for that control
• preventing and detecting fraud
• compliance with laws and regulations
• the accuracy and completeness of records, documents and explanations, including significant judgments
• giving you access to information, additional information you request, and unrestricted access to people you need to question

AR-C 70, 80 and 90 each cross-reference these preconditions and add their own. If management will not agree, you do not accept the engagement.

File mistakes peer reviewers flag

• Engagement letters missing one of the management responsibilities listed above.
• Reports that claim SSARS compliance when a required procedure was skipped and no departure was documented.
• Citing paragraph numbers from the wrong version of a section for the period under report.
• No evidence that the engagement partner considered acceptance and continuance under the firm's policies.

The peer review findings guide lists the recurring deficiencies in SSARS engagements.

Which text applies: Cedar Row Landscaping, LLC