What is Being Proposed?

The exposure draft details major changes to the verification process. A simple way to see this is the number of pages that are devoted to it. The current version of the Standards have roughly four pages on verification; the proposed language is roughly five-times as much, numbering approximately 20 pages.

The procedures for both verifications and examinations is much more detailed, more prescriptive.

The scope of verification has been expanded; for example, verifiers will be required to review marketing materials and advertisements.

The document proposes specific wording for the terms
of engagement: this is not the case today. The engagement letter must include:

  • 1
    The objective and scope of the engagement, including the period(s) being verified;
  • 2
    The responsibilities of the verifier;
  • 3
    The responsibilities of the firm;
  • 4
    A statement about the inherent limitations of a verification;
  • 5
    A statement that the GIPS standards are the evaluation criteria for the engagement;
  • 6
    A statement that the verification does not provide assurance on the operating effectiveness of the firm's controls or policies and procedures for complying with the GIPS standards; and
  • 7
    A statement that the firm agrees to provide the verifier with a representation letter at the conclusion of the verification.

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