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Board weighs peer-review waiver requests as staff and CTCPA explain AICPA program limits
Summary
Board members heard extended testimony from CTCPA staff and discussed regulatory misalignment with the AICPA peer-review program, the shortage of reviewers, and the timing rules that govern peer review. Members agreed to pursue regulatory clarification and requested more documentation before deciding on specific waiver requests.
Board members on a virtual Consumer Protection Department licensing meeting spent substantial time on peer review waiver requests and the state’s requirement that firms undergo peer review. Staff and Connecticut Society of CPAs representatives described how national AICPA peer-review standards and timing rules create gray areas when firms claim they no longer perform attest or audit work.
Why it matters: State peer review and waiver decisions determine whether firms can lawfully offer audit/attestation services and whether a firm must undergo a quality review; ambiguity in rules can leave firms without clear paths to compliance and can affect firm mobility across states.
CTCPA staff member Julie explained that the AICPA’s peer-review program sets national timing and scope rules that are based on client year‑ends and report dates, not solely on when a report is signed, and that there is no practical alternative peer-review program outside the AICPA standards. The CTCPA representatives and the department noted there is a national shortage of available peer reviewers and that some firms have resigned from the AICPA program rather than complete peer review obligations.
Board discussion focused on three recurring issues: (1) timing — how the peer-review “year” is calculated and which client year‑ends are included in a review population; (2) waiver scope — whether firms that say they do not perform attest/assurance work should be granted waivers if their websites or past reports indicate otherwise; and (3) enforcement options when firms have resigned from peer review but still display attest services.
No formal votes were taken on individual waiver cases during the discussion. Instead, board members instructed staff and suggested forming a subcommittee to: compare Connecticut rules with AICPA standards and other states’ approaches, collect peer-review acceptance letters and report-year data for the firms under review, and draft proposed regulatory clarifications. Staff agreed to provide the peer-review letters and the peer-review-year details for the firms at a future meeting.
Background and next steps
Staff noted that the state statute and regulations (including the provision cited as Section 22-81-8 in the meeting) permit waivers when a firm represents it does not engage in attest services and that waiver forms were revised this year to require more explicit information. Several board members said the statutes and rules should be clarified to match modern practice and the AICPA program. The board asked staff and CTCPA to prepare comparative materials and to convene a small group of board members and outside resources to draft regulatory options.
