[§466-42] Peer review oversight committee. (a) The board shall establish a peer review oversight committee for the purpose of:
(1) Monitoring sponsoring organizations to ensure that peer reviews are being conducted and reported in accordance with standards for performing and reporting on peer reviews adopted by the American Institute of Certified Public Accountants Peer Review Board;
(2) Reviewing the policies and procedures of sponsoring organization applicants as to their conformity with the peer review standards of any applicable peer review organization and this part; and
(3) Reporting to the board on the conclusions and recommendations reached as a result of performing the functions in paragraphs (1) and (2).
(b) Except to the extent otherwise required under this section and section 466-41(b), information concerning a specific firm or reviewer obtained by the peer review oversight committee during oversight activities shall be confidential and shall not be subject to discovery, pursuant to section 466-32, and reports submitted to the board by the peer review oversight committee shall not contain information concerning specific firms or reviewers. Members of the peer review oversight committee shall be required to execute confidentiality statements for the sponsoring organization that they oversee.
(c) Effective January 1, 2013, the peer review oversight committee shall consist of three individuals who hold permits to practice under section 466-7. No member of the peer review oversight committee shall be a current member of the board, the Hawaii Society of Certified Public Accountants Peer Review or Professional Ethics Committees, or the American Institute of Certified Public Accountants Professional Ethics Executive Committee. The members shall have significant experience with attest engagements and currently be in the practice of public accountancy at the partner or equivalent level. The member's firm shall have received a report with a rating of pass or an unmodified opinion from its last peer review.
(d) The peer review oversight committee shall make an annual recommendation to the board as to the qualifications of an approved sponsoring organization to continue as an approved sponsoring organization on the basis of the results of the following procedures:
(1) Where the sponsoring organization is:
(A) The American Institute of Certified Public Accountants;
(B) A state certified public accountant society, including the Hawaii Society of Certified Public Accountants, fully involved in administering the American Institute of Certified Public Accountants peer review program; or
(C) The public company accounting oversight board,
the peer review oversight committee shall review the published reports of the entity or the entity's successor to determine whether there is an acceptable level of oversight; and
(2) Where the sponsoring organization is other than any organization listed in paragraph (1), the peer review oversight committee shall perform the following functions:
(A) At least one member of the peer review oversight committee shall attend at least one meeting of the sponsoring organization's peer review committee; and
(B) During these visits, the peer review oversight committee members shall:
(i) Meet with the organization's peer review committee during the committee's consideration of peer review documents;
(ii) Evaluate the organization's procedures for administering the peer review program;
(iii) Examine, on the basis of a random selection, a number of reviews performed by the organization to include, at a minimum, a review of the report on the peer review, the firm's response to the matters discussed, the sponsoring organization's letter of acceptance outlining any additional corrective or monitoring procedures, and the required technical documentation maintained by the sponsoring organization on the selected reviews; and
(iv) Expand the examination of peer review documents if significant deficiencies, problems, or inconsistencies are encountered during the analysis of the materials.
(e) In the evaluation of policies and procedures of sponsoring organization applicants, the peer review oversight committee shall:
(1) Examine the policies as drafted by the applicant to determine whether the policies provide reasonable assurance of conforming to the standards for peer reviews;
(2) Evaluate the procedures proposed by the applicant to determine whether:
(A) Assigned reviewers are appropriately qualified to perform the review for the specific firm;
(B) Reviewers are provided with appropriate materials;
(C) The applicant has provided for consultation with the reviewers on problems arising during the review and that specified occurrences requiring consultation are outlined;
(D) The applicant has provided for the assessment of the results of the review; and
(E) The applicant has provided for an independent report acceptance body that considers and accepts the reports of the review and requires corrective actions by firms with significant deficiencies; and
(3) Make recommendations to the board as to approval of the applicant as a sponsoring organization.
(f) Annually, the peer review oversight committee shall provide the board with a report on the continued reliability of sponsoring organizations' peer reviews. The peer review oversight committee report shall provide reasonable assurance that peer reviews are being conducted and reported on consistently and in accordance with the Standards for Performing and Reporting on Peer Review adopted by the American Institute of Certified Public Accountants. A summary of oversight visits shall be included with the annual report. [L 2012, c 324, pt of §1]Section: Previous 466-31 466-32 466-33 466-34 466-35 466-36 466-37 466-38 466-39 466-40 466-41 466-42 466-43 Next
Last modified: October 27, 2016