Clarification of the standard for financial statement preparation engagements helps define the future of CAS practices
NEW YORK (April 1, 2025) – The CAS Advisory Council applauds the American Institute of CPAs’ (AICPA) Accounting and Review Services Committee’s (ARSC) clarification of the applicability of the standard related to financial statement preparation as part of a client advisory services (CAS) engagement. The modernization of the standards reflects the evolution of CAS and will better enable firms to further the shift into higher value advisory services.
"This change represents a new era for CAS practices,” said Becky Munson, partner at Eisner Advisory Group LLC and member of the CAS Advisory Council. “The standards now align more closely with the evolving needs of businesses and the services provided by CAS teams. This will now allow them to truly serve clients while continuing to fulfill their professional obligations. It’s a win for everyone, and we can’t thank the committee enough for their diligence in making these changes."
CPA.com and the Digital CPA community have long focused on driving the CAS opportunity for the accounting profession. In 2023, the CAS Advisory Council formed, composed of CAS practice leaders from firms of all sizes. The Council is focused on creating a framework of best practices for the category and helps enable practitioners in the shift toward higher value advisory services.
“The financial reporting standard clarification is a sea change for how client advisory services will be managed going forward,” said Erik Asgeirsson, president and CEO, CPA.com. “Outsourced accounting services have evolved considerably beyond the preparation of a financial statement—today’s modern CAS practice delivers state of the art cloud accounting capabilities with dashboards and business insights which appropriately will now fall under the consulting service and advisory area of firms.”
While CAS remains one of the fastest growing practice areas in the profession, there’s potential for firms to deliver deeper business insights. This relies on a combination of financial and non-financial inputs to allow firms to provide strategic support around business transformation, industry-specific problems and high-level strategic financial planning and analysis.
According to the recent CPA.com and AICPA PCPS CAS Benchmark Survey report, close to one-third of firms reported growth of their CAS revenues from business insights or bundles containing business insights services. And all respondents project a decrease over the next three years in services that do not qualify as CAS, such as single-service financial statement preparation. This move is fueled by client demand for deeper insights, and CPAs are well positioned to fill this need.
“The modernization of standards reflects the reality of what is already happening within CAS practices today,” said Bill Reeb, CEO of Succession Institute and past chair of the Consulting Services Executive Committee.
Sharon Berman, principal at Rehmann, agreed: “This change will streamline CAS practices and allow them to more efficiently serve the evolving needs of clients."
Firms are already looking forward to the next phase of implementation. From the DCPA Conference keynote stage last December, Angie MacPhee, managing principal of consulting and advisory services at Baker Tilly, noted how her firm will be approaching the delivery of financial statements under CAS: “We are putting it under the consulting standards. While we’ll maintain very high quality, we’re excited to organize this way.”
In the coming weeks, CPA.com will release additional resources to help firms determine how this clarification and modernization of standards helps them move forward into business insights CAS, including an FAQ, video discussions, engagement letter templates, and more. In the meantime, access the following for more information:
- AICPA Statement: AICPA Committee Approves Clarification to Standard Related to Financial Statement Preparation as Part of a CAS Engagement
- Blog: Financial reporting standards and the future of Client Advisory Services
- CPA.com and AICPA PCPS CAS Benchmark Survey report
- Tune in for an update on the next AICPA Town Hall, April 3 at 3pm ET (free for AICPA members)
About CPA.com
CPA.com brings innovative solutions to the accounting profession, either in partnership with leading providers or directly through its own development. The company has established itself as a thought leader on emerging technologies and as the trusted business advisor to practitioners in the United States, with a growing global focus.
Our company’s core mission is to drive the transformation of practice areas, advance the technology ecosystem for the profession, and lead technology research and innovation efforts for practitioners.
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