|This Statement on Standards for Attestation Engagements (SSAE) provides guidance for service auditors when performing an examination engagement to report on controls at an organization that provides services to user entities when those controls are likely to be relevant to user entities’ internal controls over financial reporting. Prior to the issuance of this statement, guidance for service auditors originated in Statement on Auditing Standards No. 70, “Reports on the Processing of Transactions by Service Organizations” (SAS 70), contained in auditing standards at AU 324. |
Like SAS 70, this SSAE permits service auditors to provide two types of reports. In a Type 1 report, the service auditor expresses an opinion on whether the service organization’s description of its controls over the service and related control objectives is fairly presented and whether the controls in the description are suitably designed. A Type 2 report contains the same opinions as in a Type 1 report, with the addition of an opinion on whether the controls were operating effectively during the period covered by the report.
SSAE 16 is effective for service auditors’ reports for periods ending on or after June 15, 2011, with earlier application permitted.
A summary of the provisions of SSAE 16 can be viewed here.