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Hello Miss, I would like to get a reconfirmation from you is that usually, the code will not prohibit the provision of tax and accounting service to the non listed entity
BUT the code state :
“Audit Clients that are Not Public Interest Entities
R601.5 A firm or a network firm shall not provide to an audit client that is not
a public interest entity accounting and bookkeeping services including
preparing financial statements on which the firm will express an
opinion or financial information which forms the basis of such financial
statements, unless:
(a) The services are of a routine or mechanical nature”Does it mean that the auditor is prohibited to the provision of tax and accounting service including the payroll service to all audit client whether its non or listed?
Thank you.
For a non-PIE (i.e. “unlisted”) client, the auditor shall NOT …. preparing financial statements … unless services are routine/mechanical. So, for example, the audit could prepare consolidation schedule that are simply arithmetically adding up all the line items – but could not determine the amounts of fair value adjustments (for example) that are management’s responsibility.
To run a payroll would be a routine/mechnical service – simply processing wages/salaries and making deductions according to pre-determined rules (e.g. tax codes) based on input provided by the client.
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