CPA Firm Independence and Technology: Complying with AICPA Guidelines

CPA Firm Independence and Technology: Complying with AICPA Guidelines

When a CPA firm attests to the accuracy of a client’s financial statements, maintaining their
independence is important to assure that they have not been unduly influenced to deliberately
or inadvertently participate in misstating published financial statements.


With the advent of new technologies, there are new factors for CPA firms to consider and the
AICPA has developed hosting services guidelines to assist in this effort.

AICPA guidelines

Overall, the AICPA makes it clear that a CPA firm cannot maintain its independence and host
data on a client’s behalf. This includes activities like hosting a client’s website, storing client
general ledger or other financial information for a client, or serving as a client’s business
continuity provider.


To be clear, a CPA firm can retain its own work product, along with copies of client data that
support its work product. What CPAs cannot do is store data on behalf of clients and they must return the original data used to perform their work after the work is completed or at least annually for ongoing client engagements.

Activities that are not hosting services

The AICPA considers the following activities to not be hosting services and therefore a CPA firm
can perform them without impairing their independence:

  • Retaining a copy of a client’s data to support a service provided

  • Retaining a copy of a work product produced, such as a tax return

  • Using general ledger software to deliver bookkeeping services, as long as one of the following occurs:

    • The client maintains its own instance of the software on its servers, with periodic updates provided by the CPA firm

    • The records are maintained in a cloud-based solution, with access granted to the CPA firm to perform bookkeeping services

  • Retaining data collected to deliver a work product for the client, such as employee survey data where the client simply received a final report

  • Using electronic portals or other means to exchange data, records, or the work product

  • Licensing software to a client that the client uses to input its data and receive an output that the client is responsible for maintaining, provided the software does not perform an activity that, if performed directly by the CPA firm, would impair independence

  • Maintaining a depreciation schedule, provided the schedule and underlying calculations are given to the client to complete the client’s books and records

  • Retaining a client’s original data or records to perform a service as long as the information is returned to the client when the work is complete or, for a multi-year project, at least annually

Technology can be immensely helpful for CPA firms as they work with clients, to ensure accuracy, save time, streamline processes, and more. CPA firms just need to ensure their use of technology complies with AICPA standards related to independence and hosting data.


Speaking of technology to simplify processes, LeaseCrunch® was created to streamline implementation of the new lease standard for CPA firms and their clients. Check out this case study of one bank’s experience using LeaseCrunch® to implement the new standard.

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