Do we need another stop on the assurance continuum? Reliability Project walks independence fine line.

• Position: Issue UPDATE

An exposure draft could come soon that proposes allowing CPAs to help small businesses prepare financial statements, but still provide a level of assurance as to the validity of those financial statements. CPAs preparing such reviews would note that independence was impaired, but the resulting review would still have standing in the marketplace.

"Right now, we are either independent or not. There isn't an opportunity to explain why or where independence was impaired. This new option would let CPAs emphasize the reliability of the financial statements. It opens a lot of opportunities for CPAs and could enhance the relationship with the client," said Bob Fay, CPA, a sole practitioner from Canton and former member of AICPA's Private Company Practice Section Executive Committee.

The exposure draft comes from The Reliability Task Force, formed by the AICPA's Accounting and Review Services Committee (ARSC). "Small business clients are telling us they want to work with their existing CPA for such services as financial statement review," said Michael P. Glynn, CPA, AICPA technical manager of audit and attest standards. "The problem is that providing that service and many others is precluded right now. Many clients then have to turn to another CPA to provide the service."

In their recommendations, the Reliability Task Force said they believe that "the public would be better served by a framework that focuses on the reliability of the financial statements."

"The end game here is reliable financial...