CCH
ProSystem fx Engagement
Patrick Manosca is a CCH Accounting and Auditing Software Specialist, for ProSystem fx Engagement (PFE). He advises firms on the utility of the software. CCH provides audit advice at the CCH Learning Academy, which is in a classroom environment. The School of Audit is the knowledge-based approach to risk based auditing. A firm can go through a Best Practices course after the firm purchases the software and buys the training. One day is to cover training and another day is to cover consulting to conform it to their practice.
CCH PFE works from a binder perspective. The savings occur the second year moving forward where firms save 25% in realization or budget savings. Users have said savings are easily 30% in the second year, according to Manosca.
From the beginning the firm is looking to get the client trial balance (TB) data into their system. Users can link to an Outlook email with an Excel file and import directly into PFE. A QuickBooks direct import is expected soon. All correspondence is kept in the same binder for each client.
From the TB, users can copy and paste with a wizard to get their TB into the PFE TB. The next step is to use the Grouping tool to summarize the accounts so there is one cash account presented although the client has several bank accounts, for example. Part of the onetime set up for a first-time audit client is to copy and paste to the balance sheet so a live link is presented. The presentation of the financial statements is determined in the beginning if desired. Then TB reports can be set up to create supporting schedules, much like a cash lead sheet. From the top ribbon on the software you can create a journal entry. A report is produced of an update of all the journal entries which can be a huge time saver on audit budgets.
Actual red tick marks are used from the menu ribbon. Users can use a column to reference where the number came from on the workpapers by left clicking on the cell and right clicking from the Insert Workpaper reference and selecting the schedule. The reference cell can then be right-clicked and opened to review where the number came from. Users bring in supporting schedules like bank reconciliations from clients. Users locate it in the binder, left-click and move it to the Cash section of the binder arranged in balance sheet order, for the typical presentation reported on the financial statements. The package is used for compilations, reviews and audits. The opinion letter and notes can link the presented numbers and the dates.
The footnotes are also updated automatically. On the menu ribbon, you can go to the CCH Footnote in the upper left hand corner and browse all the subfolders to find a sample footnote for a category. PFE is unique in that is has integrated audit content. Another library is built inside of PFE with audit programs with Knowledge Coach, which is based on the latest risk-based standards. During audit planning users select the assertions that are applicable, and are reflected in the Substantive Procedures.
During planning you determine the risks as you complete the tables. On the menu ribbon users reflect the risk with a red flag. For example: if users notice that there is little separation of duties in reconciliations and accounts payable during field work on internal controls; they reflect an audit risk that an employee could create himself as a vendor. This is then reflected in the workpapers. Based on the new standards, the peer reviewer is going to associate the risk with the auditing steps performed.
All of this can be rolled forward. If users have Knowledge Coach, they can also roll forward their updates of audit content related to current standards during the roll-forward from the prior year. There is a TB report that will help calculate the analytics. Ratios are calculated in ratio analysis based on links to the trial balance. The roll-forward is where the large savings occur.
Thompson Reuters
Engagement CS
Thomson Reuters Engagement CS is available as part of the Thomson Write-Up package or users can obtain Engagement CS separately. It was originally designed as an audit tool. Up to 75% of clients also use it for tax return workflow, according to Brian Woods with Thomson Reuters. It has a PDF editor to mark up statements which can be scrolled through. There is also a notes field below each screen. There is a trial balance grid, which can provide different views for different staff, like for tax or audit as well as necessary fields for size of column width and a code field. There is a split screen view, so adjusting journal entries can be made and posted in real-time. If the entry is out of balance, the total shows up in red to alert you to the problem. There is also a separate journal entry screen.
There is a rounding utility that will keep the subaccounts balanced when rounding by category. It can pull the trial balance from write-up, QuickBooks and Excel. The first time you import from QuickBooks you have a matching screen to match to the Engagement CS template. The spreadsheet format has columns for budget, adjusting debits and credits, another balance column and reclassifying entry columns before the final balance column.
When the audit begins you can roll the prior year settings forward to utilize the workpaper names. Users can include, exclude or replace with PPC templates, SMART Practice Aids (SPA), or a selected engagement tool that you have built. The roll-forward takes several minutes but brings in all of the current data from SPA. Users can assign workpapers to different staff on complex audits if needed. Users can assign these staff privileges to prepare entries or even delete the section.
SMART Practice Aids provide risk assessment, field work and internal control and disclosure modules. Risk assessment was the first SMART Practice Aid built. The planning questionnaire will determine the audit approach (basic or extended) after the user designates the risk as low, medium or high. The practice aid will provide the general planning questionnaire and enable users to customize or remove some of these steps. It will then produce the audit programs. The workpapers are produced by SMART Practice Aids, which can be modified. Users can drag and drop from files after giving them a name and a reference, like a bank statement. Files can also be scanned in. Users can use or create online “stamps” for notes like draft, final, and tick marks. Users can also print any file or computer screen into Engagement CS to keep in the file for later review. Rather than scan in something like a 500 page inventory, users can refer to the document and still sign off on the step.
Users can utilize a third party accounts receivable confirm tool called Capital Confirmation. Users can use Checkpoint tools which are in Word or Excel formats so they can be formatted. SMART Practice Aids utilize Checkpoint tools as well; however, users are not required to use either one. Users can use Checkpoint tools without SPA. SPA is necessary to use to determine risk assessment. The worksheets are integrated with MS Office. This allows users to reference files, much like the bank statement on the workpaper leadsheet, which are also available to others for review making the move to paperless easier. As the audit objectives on the workpapers are completed, users sign off on the column with initials and date. Another diagnostic report will show the steps that have not been completed. It will track down the steps and list the steps that will need to be completed.
There is a link in the Notes to Financial Statements that links to the trial balance whether users use Word or Excel. The user puts the cursor on the field they need to link, and clicks the function key to put in the variable in order to link the number into the Notes to Financial
Statements.
Users can sign-off and review with individual or group clicks that a privilege user can set. Users can create review notes with a subject name with unlimited field notes. There is a dialog window where the discussion can be documented. Users can also create sticky notes that can be visually pinned on the audit workpapers and the treeview of lead sheets. They can also be checked off. A total of all of these notes can be shown in a Note Report that can be “drilled down” based on who made the notes.
In the wrap-up function, users can go to Engagement Properties and key in the Report Release Date, which will provide the 45 day countdown after which it cannot be changed. On the wrap-up, users can remove all workpaper review notes so they would not be presented for peer review, for example. After wrap-up has locked down all of the details, no one except assigned partners or those with security privileges can unlock it.
You can provide all needed static documents for a Peer Reviewer by going into the diagnostic report and converting it to a PDF. Engagement CS enables multiple staff working on the audit at the same time on different parts of the audit. If staff are in the field, you can use this virtual office to work in the field, rather than use the send/receive function. It works the same except for the drag and drop function.
Users can also send the engagement by email utilizing GoFileRoom. Thomson Reuters advises firms on how to implement the software but does not provide auditing advice.
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