A river runs between them: An instructional case in professional services provided by a CPA firm

Highlight
• This case provides an introduction to attestation services and standards.
• Students are required to identify and describe the different types of attestation services.
• A request for a professional service is presented and the ability to perform the engagement in accordance with the professional standards is assessed.
• Programs for the performance of examination, review and agreed-upon procedure engagements for the requested service are prepared.
• Other factors increasing the practitioner's business risk for the engagement are identified.

This instructional case presents a realistic situation in which there is a request for professional services by a CPA firm. Two towns, Weston and Easton, are involved in a dispute over the costs of a shared wastewater treatment facility. The mayor of Easton believes his town has paid more than its agreed-upon share of the facility's operating costs over the years. The mayor of Easton has approached a local CPA firm to “audit” the amount Easton has paid towards operation of the plant and determine the amount of the overpayment. Students are asked (1) to determine whether an audit can be performed, (2) if an audit cannot be performed, to decide what type of service is appropriate, (3) to research the applicable professional standards, (4) to assess whether the applicable standards can be met, (5) to develop a program that outlines the steps/procedures to be completed when providing the professional service to the mayor, and (6) to identify other concerns relevant to accepting this engagement.