Page 637 - Auditing Standards

As of December 15, 2017

naturally want to discuss them with their client so that consideration can be given to whether disclosure
should be made in the registration statement. If disclosure is not to be made, the accountants should inform
the client that the matters will be mentioned in the comfort letter and should suggest that the underwriter be

informed promptly. It is recommended that the accountants be present when the client and the underwriter
discuss such matters.

Effective Date

.63 This section is effective for comfort letters issued on or after June 30, 1993. Early application of this
section is encouraged.

Appendix—Examples

.64

1. The contents of comfort letters vary, depending on the extent of the information in the registration
statement and the wishes of the underwriter or other requesting party. Shelf registration statements may have
several closing dates and different underwriters. Descriptions of procedures and findings regarding interim

financial statements, tables, statistics, or other financial information that is incorporated by reference from
previous 1934 Act filings may have to be repeated in several comfort letters. To avoid restating these
descriptions in each comfort letter, accountants may initially issue the comments in a format (such as an

appendix) that can be referred to in, and attached to, subsequently issued comfort letters.

Example A: Typical Comfort Letter

2. A typical comfort letter includes—

a. A statement regarding the independence of the accountants (paragraphs .31 and .32).

b. An opinion regarding whether the audited financial statements and financial statement schedules
included (incorporated by reference) in the registration statement comply as to form in all material
respects with the applicable accounting requirements of the Act and related rules and regulations
adopted by the SEC (paragraphs .33 and .34).

c. Negative assurance on whether—

1. The unaudited condensed interim financial information included (incorporated by reference) in

the registration statement (paragraph .37) complies as to form in all material respects with the
applicable accounting requirements of the Act and the related rules and regulations adopted by
the SEC.

2. Any material modifications should be made to the unaudited condensed consolidated financial

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