Agreed-Upon Procedures and SAS 70

Agreed-Upon Procedures
Management will often request an agreed-upon procedures engagement when they have specific financial elements that require further insight.  We will work with management to define the necessary agreed-upon procedures to meet their needs and enable us to issue a complete report at the conclusion of our engagement. 

The subject matter for an agreed-upon procedures engagement may take many forms and may be as of a point in time or for a period of time.  Examples include:

  • Specific inventory or receivable audits
  • Due diligence on buying a business
  • Specific issues relating to a business
  • Licensing and royalty engagements
  • Benefit claims audits
  • Employer compliance/payroll audits

 

SAS 70 Report
Many service organizations require an in-depth audit of their internal control systems.  A SAS 70 report will present your control activities and processes in a cohesive format to your customers and customer’s auditors. Some of the benefits include:

  • Reducing or potentially eliminating questions and costly site visits
  • Differentiating the service organization from its peers and building trust
  • Additional assurance to management and governance bodies


There are two types of reports:

Type I

  • An opinion on the design of controls for a specified point in time
  • A description of the control environment, its key objectives, and the processes in place to achieve the objectives


Type II

  • More in-depth
  • An opinion on the design, implementation and effectiveness of controls for a specified period of time
  • A description of the control environment, its key objectives, and processes in place to achieve the objectives
  • Tests of operating effectiveness and results.


Practice LeadersJames E. Merklin, partner
Danielle J. Kimmell, sr. manager
Michael J. Moldvay, sr. manager