AICPA Issues SAS No. 150: External Confirmations for a Digital Environment

What the source says

Per the Journal of Accountancy description, SAS No. 150, External Confirmations, was published following an AICPA Auditing Standards Board vote and is designed to address the contemporary, digitally driven environment in which confirmations take place.

Why this matters to CPA firms

External confirmations are a core audit procedure for verifying balances and assertions. An updated standard focused on digital environments signals changes to expectations around how confirmations are requested, transmitted, authenticated, and documented when electronic channels are used. Firms that perform audits will need to interpret the new standard's guidance relative to current confirmation service providers, secure messaging, and remote evidence obtained via APIs or electronic portals.

Operational, staffing, and judgment considerations

Implementing SAS No. 150 will likely require updates to audit programs, templates, and firm guidance. Practice leaders should plan for training hours for engagement teams on authentication controls, vendor evaluation, and evidence sufficiency in electronic contexts. Smaller engagements may require reallocating specialist time (IT audit or cybersecurity expertise) to support confirmation procedures, increasing human labor for some engagements while potentially reducing time for others if electronic confirmations become more efficient.

Risk and economic impacts

The new standard may reduce certain operational frictions but increases the need for professional judgment around the reliability of electronic evidence and the controls supporting confirmation channels. Firms should anticipate initial implementation costs-training, methodology updates, and tooling-and potential downstream benefits in efficiency or improved audit quality if teams adopt robust electronic confirmation practices.