Practice Administration Review

Effective practice administration means a firm has implemented policies and procedures within its system of quality management that enable it to meet the needs of clients and to manage staff (as applicable) while complying with all relevant standards and regulations.

A practice administration review (PAR) means a formal process by CPA Saskatchewan to gain an understanding about the firm’s policies and procedures relating to one or more specific practice administration issues (identified through regulatory processes such as practice inspection or professional conduct) and to observe how the firm carries out tasks and functions relating to those issues and the related output (similar to an internal controls review). A PAR will occur on site at the firm’s location of practice.

Specific practice administration issues can cover areas such as:

The intention of the PAR program is to protect the public and to provide the firm with relevant education, tools, and guidance to reduce risks associated with observed practice administration issues. CPA Saskatchewan works with the firm to develop an action plan to address any areas of insufficiency noted from the PAR procedures and to monitor that the approved plan is implemented.

How a PAR works:

Included with notification is a request to provide certain information for the reviewers’ observation and discussion.
An in-person meeting is held at the firm’s location to gather information about the firm’s policies and procedures relating to the practice administration issue(s).
While onsite, the reviewers observe specific documents or perform walkthroughs of the firm’s processes related to the information requested.
The reviewers may conduct interviews of additional staff members, where deemed applicable. This may occur after the date of the onsite meeting.
Follow-up questions may be asked throughout the PAR reporting process.
A report listing each area of insufficiency identified or observed during the performance of the PAR will be provided to the firm.
A 2-week period of time generally is provided for receipt of comments from the firm on the report.
A final copy of the report is prepared including the reviewer’s recommendation for next steps for determination by the Professional Practice Committee.

After a PAR is complete, a report is shared with the firm that outlines observations made throughout the PAR process. In most cases, a corrective action plan (CAP) is required from the firm. The CAP needs to specify how changes will be implemented and to identify tools and resources that will be adopted by the firm. In addition to a CAP, the following determinations by the Professional Practice Committee may be made (other outcomes may arise not listed below):

Requirement for the members of the firm to complete professional development activities specific to the practice administration issue.
Requirement to complete a follow-up PAR by CPA Saskatchewan within a specified time period.
Requirement for the firm to provide documentation of updated firm policy and procedures and/or firm structures and models sent to CPA Saskatchewan within a specified time period.
Ongoing on-site monitoring by CPA Saskatchewan or supervision by an approved practice monitor for a specified time period.
Practice restriction on the delivery of specific services.
Practice inspection to occur within a specified time period.
Investigation to occur on areas where a potential breach of rules is identified by the practice administration reviewer. A referral is made to the Professional Conduct Committee.

All firms are expected to comply with the Rules of Professional Conduct applicable to firms set out in Rules 230.1 and 231.1 (https://www.cpask.ca/protecting-the-public/governing-documents)

All firms are encouraged to review the International Federation of Accountants Guide to Practice Management for Small- and Medium-Sized Practices, 4^th edition. https://www.ifac.org/knowledge-gateway/small-and-medium-sized-practices-smps/publications/guide-practice-management-small-and-medium-sized-practices-0