Wiley Practitioner's Guide to GAAS 2015: Covering all SASs, SSAEs, SSARSs, PCAOB Auditing Standards, and Interpretations

AU-C 920 Letters for Underwriters and Certain Other Requesting Parties

AU-C ORIGINAL PRONOUNCEMENTS

Original Pronouncements

Statements on Auditing Standards (SASs) 122, 125, 129.

APPLICABILITY

In addition to issuing a comfort letter to an underwriter, accountants may also issue a comfort letter to a broker-dealer or other financial intermediary, acting as principal or agent in an offering or a placement of securities in connection with the following types of securities offerings:

1. Foreign offerings, including Regulation S, Eurodollar, and other offshore offerings
2. Transactions exempt from the registration requirements of Section 5 of the Act, including those pursuant to Regulation A, Regulation D, and Rule 144A
3. Securities offerings issued or backed by governmental, municipal, banking, tax-exempt, or other entities that are exempt from registration under the Act

In those offerings, the accountant may issue a comfort letter only if the party provides a representation letter that represents that the party's review process is substantially consistent with the review process under the 1933 Act.

An accountant is also permitted to issue a comfort letter in connection with acquisition transactions in which there is an exchange of stock and comfort letters that are requested by the buyer or seller, or both, as long as a representation letter is provided that represents that the party's review process is substantially consistent with the review process under the 1933 Act.

A comfort ...