Earlier this month I posted about the issue of firms wanting their returns “audited” when they have a GIPS(R) (Global Investment Performance Standards) verification conducted. At that time I mentioned that I had asked a couple of CPA colleagues their thoughts on this. I mentioned at that time how the first responded; here’s what the second wrote:

[Accounting firms] shouldn’t let anyone say that they were “audited.” No accounting firm would let someone present their performance as audited.  We do an examination.  When my clients ask me about this, I respond that they can say that their results were “EXAMINED.”      
 
If you look at the opinion that the accounting firm renders, its heading is “Report of Independent Accountants.”  It does not state “Report of Independent Auditors.”

We can only call ourselves Independent Auditors when we conduct an audit.  An audit can only be conducted on a full set of financial statements (with a balance sheet, statement of Operations and Cash flows).  We can not (under our professional standards) audit part of financial statements or a performance presentation.

While it’s common to hear our verification clients state that their “auditors are here” or that their numbers have been “audited,” it’s clear that this is technically incorrect. And, it’s clear that it’s incorrect for an accounting firm to try to distinguish themselves from non-accounting firms who perform verifications by suggesting that with them the client gets “audited returns.”

Interesting, I think. Hope you agree.