SSAE 16 Type 1 Reporting and 5 Important Items Service Organizations Need to Know

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NDB Accountants & Consultants

Learn about SSAE 16 Type 1 and Type 2 Reports from NDB Accountants & Consultants

Dallas, TX (PRWEB) August 20, 2012

SSAE 16 Type 1 and Type 2 reports are being issued at a feverish pace for many of today's service organizations, which are effectively businesses that provide critical outsourcing functions for other entities. And though the passing of the torch from SAS 70 to SSAE 16 became final for reporting periods ending on or after June 15, 2011, there's still much to learn about the new AICPA standard, such as the differences between SAS 70 and SSAE 16. Thus, take note of the following 5 important items - provided by NDB Accountants - that all service organizations should be aware of regarding SSAE 16 Type 1 reports.

1. SSAE 16 is part of the new AICPA SOC framework. The AICPA Service Organization Control (SOC) framework consists of three (3) reporting options; SOC 1, SOC 2 and SOC 3. SSAE 16 Type 1 and Type 2 reports fall under the SOC 1 framework, while AT 101 and the Trust Services Principles are used for SOC 2 and SOC 3 reporting.

2. SSAE 16 Type 1 reports are a "point in time". Because of this, Type 1 reports have limited value, as the real reporting option are SSAE 16 Type 2 reports. Even with that said, Type 1 reports are still a great stepping stone towards Type 2 compliance.

3. SSAE 16 reports require a description of the "system". Whereas SAS 70 required a description of "controls", SSAE 16 Type 1 and Type 2 reports require a description of its "system", which is essentially the following: "the services provided, along with the supporting processes, policies, procedures, personnel and operational activities that constitute the service organization's core activities that are relevant to user entities." -ssae16.org.

4. SSAE 16 reports require a written statement of assertion. Unlike SAS 70, SSAE 16 requires management to provide a written statement of assertion, which is essentially requiring management to assert to a number of clauses and provisions. A well-qualified, PCAOB CPA firm - such as NDB Accountants - can provide service organizations with a template to follow.

5. SSAE 16 will continue to grow in prominence. That's right. The rush is on with SSAE 16 reporting and there seems to be no end in sight, with SOC 2 and SOC 3 reporting capturing minimal fanfare, at least for now.

Visit the official SSAE 16 Resource Guide today, developed exclusively by NDB Accountants & Consultants.

Call NDB Accountants today to receive a fixed fee from a nationally recognized PCAOB CPA firm specializing in SSAE 16 Type 1 and Type 2 reporting. Please call Christopher G. Nickell, at 1-800-277-5415, ext. 706 or Charles Denyer, at 1-800-277-5415, ext. 705.

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