OCBOA sounds like something you wear around your neck.
Statements on Auditing Standards (SAS) 62, "Special Reports," and Standards for Accounting and Review Services (SARS) 19 allow accountants to use OCBOA. "... an independent auditors judgement concerning the overall presentation of financial statements should be applied withing an identifiable framework." This framework can include tax basis, cash basis, and even any "identifiable framework" that the National Society of Accountants (NSA) Accounting Standards Committee produces, such as TAGSB.
I am unclear whether we can use TAGSB for OCBOA. It would make logical sense that TAGSB is another comprehensive basis of accounting. There are a myriad of rules that mention what types of "identifiable frameworks" are appropriate in specific situations. It would be nice if someone could clarify this point.
Several points were made in a recent seminar on OCBOA that I attended. It would be nice to get more clarification on these points:
- When IFRS comes in OCBOA will no longer be permitted. True or False and Why?
- OCBOA is not appropriate when the third party is a bank and the purpose is to obtain a loan. True or False and Why?
- Are there any other third parties where OCBOA is not appropriate?