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SAS 70 (Statement on Auditing Standard 70)What is SAS 70?SAS 70 is an acronym for Statement on Auditing Standard 70; it was developed and is maintained by the AICPA (American Institute of Certified Public Accountants). Specifically, SAS 70 is a "Report on the Processing of Transactions by Service Organizations" where professional standards are set up for a service auditor that audits and assesses internal controls of a service organization. At the end of the audit, the service auditor issues an important report called the "Service Auditor's Report”. SAS 70 also describes the procedures for performing a service auditor’s examination (SAS 70 audit) of a service organization’s controls. At the completion of a SAS 70 audit, a service auditor’s report (SAS 70 report) is issued by the service auditor. There are two types of SAS 70 reports:
SAS 70 Services
What is the significance of SAS 70 compliance?
SAS 70 Type I Audit CertificationA Type I service auditor’s report includes the service auditor’s opinion on the fairness of the presentation of the service organization's description of controls that had been placed in operation and the suitability of the design of the controls to achieve the specified control objectives. SAS 70 Type II Audit CertificationSAS 70 Type II builds on the Type I report to also include an assessment of the effectiveness of the controls over a period of time, which is recommended to be no less than six months. Such a report can be used to provide evidence of the effectiveness of the controls in meeting stated objectives during the specified period. Benefits of SAS 70 ComplianceBenefits to the Service Organization
Benefits – Users
Other BenefitsThe SAS 70 audit report allows the service organization to provide its customers with independent third-party verification about the state of the internal controls governing the integrity, reliability, effectiveness, and security of the processing services provided to user organizations. The SAS 70 audit report can be used by user organization’s financial statement auditors as a substitute for those parties performing their own first-hand audit procedures. Undergoing the SAS 70 audit distinguishes the service organization from its competitors. The SAS 70 audit process can provide benefits similar to an internal audit function. A SAS 70 audit can improve or sustain business relations between service providers and user organizations. It may be also viable to pass the costs of fees paid for the SAS 70 audit to the user organization. Success with SAS 70
SAS 70 For WhomA SAS 70 review is applicable when elements of a company’s processes are performed by a service provider and the company:
There are numerous types of services that may be performed by an outsourced service provider:
Contact usPlease feel free to contact us. We are looking forward to hearing from you! Rajendra Khare Please note: Email communication would be preferred mode of communication. See Also:
Disclaimer: Consulting and other specialized assessments services are provided through a separate legal entity in order to have full compliance to the broader principles of conflict of interest & specifically in compliance to ISO 17021 and SEI Conflict of Interest Policy.
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