【文章內(nèi)容簡介】 ents and the extent to which management has attempted to do so and Whether management is able to assess the controls or obtain evidence of operating effectiveness of relevant controls in the absence of having access to the controls The PCAOB staff provides the following examples of how to apply the aforementioned guidance Inability to obtain evidence of the operating effectiveness of controls at the service anizationWhen the transactions or events subject to the internal controls at the service anization are material to the panys financial statements and management is unable to obtain evidence about their operating effectiveness the auditor ordinarily would determine that a material weakness exists However for example if the servicing contract with the service anization was executed in 2021 ie well before the existence of the SOA and management already has negotiated with the service anization to provide a suitable type 2 SAS70 report next year the auditor might determine that management had fulfilled its responsibilities under AS2 Accordingly the auditor might be able to plete the audit of internal control over financial reporting On the other hand the auditor ordinarily would determine that management had not fulfilled its responsibilities under AS2 in the following circumstances 1 if management recently renewed its contract with the service anization but did not negotiate either an agreement about obtaining a suitable type 2 SAS70 report or permission to test controls at the service anization or 2 if the contract with the service anization is longdated and management has not attempted to negotiate to obtain the necessary evidence of operating effectiveness of controls Accordingly in these circumstances the auditor would be required to disclaim an opinion and would need to evaluate his or her additional responsibilities under AU Section 317 and under Section 10A of the Securities Exchange Act of 1934 Consolidation of variable interest entities The SEC allows management to limit its assessment of internal control over financial reporting by excluding certain entities that are subject to consolidation under FASB Interpretation No 46 Consolidation of Variable Interest Entitiesan Interpretation of ARB No 51 FIN46 For example management is permitted to exclude from the scope of its assessment the controls of an entity in existence prior to December 15 2021 that is consolidated pursuant to FIN46 for which the pany does not have the right or authority to assess the controls and also lacks the ability to make that assessment In such situations according to AS2 the auditor may limit the audit of internal control over financial reporting in the same manner and report without reference to the scope limitation On the other hand if management is unable to assess the controls of an entity consolidated pursuant to FIN46 that came into existence subsequent to December 15 2021 the auditor would conclude that a control deficiency exists accordingly if the consolidated variable interest entity is material to the panys financial statements the auditor ordinarily would conclude that this represents a material weakness in internal control over financial reporting Also the auditor needs to determine whether management has fulfilled its responsibilities as described in paragraph 20 of AS2 If the auditor determines that management has not fulfilled its responsibilities the auditor is required to disclaim an opinion Also to the extent that management has willfully decided not to fulfill its responsibilities the auditor may have additional responsibilities under AU Section 317 and under Section 10A of the Securities Exchange Act of 1934 Service Organizations By virtue of the requirement in AS2 for the auditor to perform at least one walkthrough for each major class of transactions if a service anizations services involve the processing of a major class of transactions should the auditor perform walkthroughs at the service anization AS2 requires the auditor to perform at least one walk