Page 680 - Auditing Standards

As of December 15, 2017

4 It is recognized that what is "substantially consistent" may vary from situation to situation and may not be the
same as that done in a registered offering of the same securities for the same issuer; whether the procedures
being, or to be, followed will be "substantially consistent" will be determined by the requesting party on a case-
by-case basis.

5 If a nonunderwriter requests a comfort letter in connection with a securities offering pursuant to the Act, the
wording of the representation letter should be revised as follows:

"This review process . . . is substantially consistent with the due diligence review process that an underwriter
would perform in connection with this placement of securities. We are knowledgeable with respect to the due

diligence review process that an underwriter would perform in connection with a placement of securities
registered pursuant to the Securities Act of 1933."

6 In an acquisition of securities, this sentence could be reworded to refer to "issuance of securities." See

paragraph .05.

7 If this letter is requested in connection with a secured debt offering, the accountants should also refer to the
attest interpretation "Responding to Requests for Reports on Matters Relating to Solvency" (AT section 9101.23-
.33) for inclusion of additional statements.

8 See the auditing interpretation "Consenting to Be Named as an Expert in an Offering Document in
Connection With Securities Offerings Other Than Those Registered Under the Securities Act of 1933"
(paragraphs .12-.15 of AI 26, Responsibilities Regarding Filings Under Federal Securities Statutes: Auditing
Interpretations of AS 4101).

9 See AS 4101, Responsibilities Regarding Filings Under Federal Securities Statutes, for a discussion of

certain responsibilities of accountants that result from the inclusion of their reports in registration statements.

10 Negative assurance consists of a statement by accountants that, as a result of performing specified
procedures, nothing came to their attention that caused them to believe that specified matters do not meet a
specified standard (for example, that nothing came to their attention that caused them to believe that any
material modifications should be made to the unaudited financial statements or unaudited condensed financial

statements for them to be in conformity with generally accepted accounting principles).

11 It is important to note that although the illustrations in this section describe procedures that may be
followed by accountants as a basis for their comments in comfort letters, this section does not necessarily
prescribe such procedures.

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