What is a “Peer Review”?
Peer review is the evaluation of work by one or more people of similar competence to the producer of the work. Essentially, it is the self-regulation by qualified members of a profession of that profession.
What is a “Peer Review” Applicable to Certified Public Accountants?
Summary of the Nature, Objectives, Scope, Limitations of, and Procedures Performed in System and Engagement Reviews and Quality Control Materials Reviews (as Referred to in a Peer Review Report)
(Effective for Peer Reviews Commencing on or After January 1, 2009)
Firms (and individuals) enrolled in the American Institute of Certified Public Accountants (AICPA) Peer Review Program are required to have a peer review, once every three years, of their accounting and auditing practice related to non- Securities & Exchange Commission (SEC) issuers covering a one-year period. The peer review is conducted by an independent evaluator, known as a peer reviewer. The AICPA oversees the program, and the review is administered by an entity approved by the AICPA to perform that role.
The peer review helps to monitor a CPA firm’s accounting and auditing practice (practice monitoring). The goal of the practice monitoring, and the program itself, is to promote quality in the accounting and auditing services provided by the AICPA members and their CPA firms. This goal serves the public interest and enhances the significance of AICPA membership.
There are two types of peer reviews: System Reviews and Engagement Reviews. System Reviews focus on a firm’s system of quality control and Engagement Reviews focus on work performed on particular selected engagements. As noted in paragraphs 4 and 157, a further description of System and Engagement Reviews, and Quality Control Materials (QCM) Reviews, as well as a summary of the nature, objectives, scope, limitations of, and procedures performed on them, is provided in the following sections.
My last peer review encompassed the three-year period ended July 31, 2014. Click here for a copy of my peer review report.