Feeley & Driscoll, P. C. Announces the Benefits of SAS 70 / SSAE 16 Examinations
Feeley & Driscoll announces the importance of receiving a SAS 70 / SSAE 16 audit to examine internal controls and boost growth in the new year. SAS 70 is phasing out this year and is being replaced by Statement on Standards for Attestation Engagements No. 16, Reporting on Controls at Service Organizations (“SSAE 16”). SSAE 16 is effective for reports issued on or after June 15, 2011.
Boston, MA (PRWEB) January 10, 2011
The accounting firm of Feeley & Driscoll announces the importance of receiving a SAS 70 / SSAE 16 audit to examine internal controls and boost growth in the New Year. Organizations that provide services to other organizations, such as payroll processing, order fulfillment or other “outsourced” functions are increasingly finding that their ability to compete and secure new business often depends on whether or not they have undergone a SAS 70 audit of its operations. This reality will only increase in the future as more and more entities look to outsource non-core functions and as technology continues to evolve.
However, the requirement to have such an audit SHOULD NOT be viewed as a necessary evil; rather, best-in-class service organizations have acknowledged long ago that it provides them with a competitive advantage and enormous opportunities for growth.
What is a SAS 70/SSAE 16?
The acronym SAS 70 references Statement on Auditing Standards No. 70, Service Organizations, which sets forth guidelines for an examination engagement performed by an independent public accountant that reports on the controls in place at a service organization.
SAS 70 is phasing out this year and is being replaced by Statement on Standards for Attestation Engagements No. 16, Reporting on Controls at Service Organizations (“SSAE 16”). SSAE 16 is effective for reports issued on or after June 15, 2011.
Because a service organization is often a critical part of a client’s internal control environment, it was important to have a mechanism that would allow for the reporting on the internal controls by one auditor whose report is then shared with the service organization’s clients’ auditors. You can imagine the alternative - having each individual client performing separate engagements would be a nightmare. Thus the necessity for SAS70/ SSAE16.
Benefits of a SAS 70/SSAE 16
We have seen the following tangible benefits for organizations undergoing an examination of their service operations:
Opening of New Markets and New Customers and Retention of Existing Clients
As technology and outsourcing of non-core competencies by organizations of all sizes continues to evolve, the SAS 70/SSAE 16 will play an important role. With a SAS 70/SSAE 16, your company will be in a position to compete with larger organizations that provide similar services.
In fact, if you hope to secure publicly traded companies as part of your client list, you will need to have a SAS 70/SSAE 16 examination. The Sarbanes Oxley Act (“SOX”), which, among other items, focuses on internal controls of publicly traded companies, practically ensured this requirement for such entities.
Eliminating the Possibility of Being Excluded from Future Opportunities
Many of our clients’ first forays into having a SAS70/SSAE16 examination was due to a prospect issuing a Request For Proposal (“RFP”) which asked for a copy of their latest SAS 70. Unfortunately, by not having such an examination, you face the likelihood of being eliminated from an opportunity before having the chance to bid – regardless if you are the most qualified candidate!
The old saying, “You can’t fight City Hall” is apropos when dealing with having a SAS70/SSAE 16 examination; no matter how much you protest or try to educate your prospects on your environment, the lack of the examination could eliminate you from consideration.
Laying a Solid Foundation for Future Initiatives
A SAS 70/SSAE 16 examination provides you with an assessment of your internal control environment. By working with the SAS 70 Auditor that is performing the examination, you will have the opportunity to implement processes and procedures that your organization may be lacking. Making necessary improvements will position your organization for growth and assist with the implementation of future business initiatives.
It is common for clients to leverage their existing SAS70 examination for one service line as they develop new business products and offerings. By already having undergone the process, clients are acutely aware of what controls they will need to implement for the new offerings.
Next Steps
If you have not undergone a SAS 70/SSAE 16 examination, we strongly recommend that you have a “Readiness Assessment” performed to determine where potential internal control weaknesses exist in your organization.
An assessment will afford you the opportunity to correct the weaknesses. The alternative, plunging head first into a SAS70/SSAE16 examination could possibly result in a less than “clean” opinion from the service auditor and the inherent negative ramifications that will result as you face the market.
About Feeley & Driscoll, P. C.
Feeley & Driscoll, P. C. is aBoston Accounting Firm employing 140 people with offices in Boston, Massachusetts and Nashua, New Hampshire. For over 35 years, Feeley & Driscoll has focused its expertise to build profitability for its clients in Massachusetts, New Hampshire, Rhode Island, Connecticut, Vermont, Maine and internationally. The firm has provided high-quality assurance, tax and business consulting services to an array of industries, including clean technology, high technology, biotechnology, life sciences, construction, architects and engineers, nonprofit organizations, healthcare, manufacturing and distribution, litigation, forensics, and information technology. For more information regarding SAS70 audits or to contact one of our specialists, please call 1-888-875-9770 or visit http://www. fdcpa. com.
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