With continued tax filing deferrals and finalizing all those December and March year-ends, the summer was busy. We were looking forward to a bit of a slower pace this fall when the first June year-ends started to come in. The full realization of the significance of the accounting impact related to COVID subsidies and programs as well as entity-specific assurance related impact was upon us. So here we are in full development phase with professional development sessions providing an outline for COVID related considerations and other resources to assist organizations and firms.
How difficult could it be to accounting for CEBA under an accounting framework? That depends on how often you deal with the recognition, measurement, presentation and disclosure requirements for government assistance, interest-free loans and financial instruments all within one transaction.
What would sufficient evidence under an audit or review engagement look like? This answer will differ depending on materiality, likely or material misstatement assessments and other professional requirements such as the consideration of non-compliance with laws and regulations.
We have provided templates that can easily be modified to your firms approach. A sample memorandum and sample working paper to document your assurance procedures have been included for both a review engagement and an audit engagement.
