The AICPA recently issued a new standard which will apply to all members of the AICPA—not just those that have specialized credentials like Certified in Financial Forensics (CFF) or Accredited in Business Valuation (ABV). The Statement on Standards for Forensic Services No. 1 (SSFS1) will be effective for all engagements that the CPA accepts on or after January 1, 2020.
SSFS1 will apply in litigation support and investigation engagements. The term “litigation” includes disputes and all forms of alternative dispute resolution, not just formal litigation. An “investigation” refers to a matter conducted in response to specific concerns of wrongdoing in which the member is engaged to perform procedures, the results of which will help stakeholders form conclusions on the merits of the concerns.
SSFS1 is a big step for the accounting profession. In the last 20 years, forensic accounting has grown and evolved to match the legal community’s expectations. SSFS1 formalizes the best practices identified by industry leaders. Elizabeth Woodward, Dean Dorton Director of Forensic Accounting, serves on the AICPA’s eight-person Forensic and Litigation Services Committee along with Dave Duffus, who is interviewed in an article that explains more.
What does this mean for me?
If you hire, or depose, accounting experts you should read SSFS1. You will want to insure that experts you hire know about, and follow, the standard. You will also want to use deposition to make sure the opposing expert is aware of, and followed the standard. If you have questions on the new standard, or its implementation, please contact Elizabeth Woodward or any member of the Dean Dorton Forensic and Business Valuation team.
