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In April 2010, the AICPA Auditing Standards Board issued the long awaited Statement on Standards for Attestation Engagements (SSAE) No. 16, Reporting on Controls at a Service Organization. The attestation standard was developed as a result of CPAs providing attestations on subject matter other than the fairness of the presentation of financial statements. The effective date for SOC 1: SSAE 16 is June 15, 2011; however, earlier implementation is permitted. A-lign can assist clients in several ways with their SSAE 16 examination and compliance initiative. Whether we are the service auditor or assisting companies in their transition from SAS 70 to SSAE 16 examination, our experienced professionals will work to ensure that the SSAE 16 report achieves management’s compliance objectives. SOC 1: SSAE 16 Type 1 Examination A SSAE 16 Type 1 examination is a report on management’s description of a service organization’s system and the suitability of the design of controls. SOC 1: SSAE 16 Type 2 Examination A SSAE 16 Type 2 examination is a report on management’s description of a service organization’s system and the suitability of the design and operating effectiveness of controls. Components of SSAE 16 Reports In the SSAE 16 examination report, management describes their service organization’s system. The description will need to include detail such as how transactions are processed and reported to user organizations, the specified control objectives and controls designed to achieve those objectives, along with additional aspects of internal control such as control environment, risk assessment, information and communication systems, control activities and monitoring controls. In the case of a Type 2 report, management includes relevant details of changes to the service organization’s system during the period covered by the description. Furthermore, management provides the auditor with a written assertion to be included in the service auditor’s SSAE 16 examination report. The written assertion states the following: •Management’s description of the service organization’s system fairly presents the service organization’s system that was designed and implemented as of a specified date (or for a Type 2 – throughout the specified period); •The controls related to the control objectives stated in management’s description of the service organization’s system were suitably designed to achieve those control objectives as of the specified date (or for a Type 2 – throughout the specified period); •The controls related to the control objectives stated in management’s description of the service organization’s system operated effectively throughout the specified period to achieve those control objectives (Type 2 only). With the new SOC 1: SSAE 16 examination report, the service auditor will now make an attestation on these management assertions. The service auditor will assess whether management has used suitable criteria: •In preparing its description of the service organization’s system; •In evaluating whether controls were suitably designed to achieve the control objectives stated in the description; and In the case of a SSAE 16 Type 2 report, in evaluating whether controls operated effectively throughout the specified period to achieve the control objectives stated in the description of the service organization’s system. Our Services A-lign can provide Type 1 or Type 2 SSAE 16 examination services to companies throughout the world. A-lign will act as the service auditor to perform the SOC 1: SSAE 16 examination. For a description of our SSAE 16 service auditor methodology, please contact us. Due to the independence requirements certified public accounting firms must adhere to, A-lign can also assist organizations with the transition to the SSAE 16 standard who do not wish to change service auditors but do not possess the expertise internally to develop their assertion and provide a basis for that assertion. A-lign will work with your company and your service auditor to ensure that a basis has been formed for management to make an assertion. Additionally, A-lign can serve as a liaison between the company and the service auditor to ensure a successful execution of the SSAE 16 examination. For a description of our SSAE 16 transition methodology

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