SIP - ALASKA - 18 AAC 53.170
18 AAC 53.170. ATTEST ENGAGEMENTS
(a) To meet the reporting requirements of 18 AAC 53.100(b), a CAR must submit to an attest engagement that consists of a review of the supporting documentation used to prepare reports required under this chapter, for accuracy, completeness, and conformance with the requirements of this chapter.
(b) An attest engagement must be conducted by an independent certified public accountant (CPA) in a manner consistent with applicable professional standards, including those in 12 AAC 04. The CPA may not be an employee of the CAR. Nothing in this subsection prohibits the CPA from requesting assistance from the CAR's internal auditors in accordance with the document entitled Codification of Statements on Standards for Attestation Engagements, published by the American Institute of Certified Public Accountants (AICPA), as amended through January 1, 1997.
(c) A CPA shall exercise due diligence in conducting an attest engagement in accordance with the agreed-upon procedures described in this section.
(d) Unless another form of sample selection is approved by the department, a CPA shall determine the sample size for each population of supporting documentation that is sampled in the attest engagement as set out in Table 1 of this section. The number of the population from which a sample must be drawn may vary depending on the circumstances for each attest engagement. Sample items must be selected in such a way that the sample can be expected to be representative of the population. If the department approves the use of another method of sample selection, or another method to determine the sample size, that method must be summarized in the attest engagement report.
TABLE 1. POPULATION SAMPLE SIZE
(e) An attest engagement must include the review and analysis of CAR records that show the
Number in Population (N)
66 or larger
41 - 65
26 - 40
0 - 25
N or 24, whichever is smaller
(1) quantity and oxygen content of gasoline entering the terminal and leaving the terminal in bulk;
(2) destination, quantity, and oxygen content of each truckload of oxygenated gasoline going to specific covered areas;
(3) oxygen content of gasoline in storage tanks from which trucks are loaded, and the calculations used to determine the characteristics of the gasoline;
(4) oxygenate type and amount that was blended; and
(5) testing results for storage tanks when additional gasoline is added.
(f) Unless other procedures are approved by the department, an attest engage-ment must include at least the following agreed-upon procedures, as appropriate, when reviewing a CAR's reporting forms:
(1) read the reports completed by CAR management and submitted to the department as required in 18 AAC 53.100;
(2) obtain from the CAR an inventory reconciliation that summarizes the receipts and deliveries of all gasoline, gasoline blendstocks, and oxygenates by a CAR serving a control area, and
(A) test the mathematical accuracy of the inventory reconciliation;
(B) agree beginning and ending inventory amounts to the company's perpetual inventory records; and
(C) agree deliveries into the control area to the reports submitted to the state as required in 18 AAC 53.100, if applicable;
(3) obtain a listing of all gasoline, gasoline blendstocks, and oxygenate receipts during the period, and
(A) test the mathematical accuracy of the listing;
(B) agree amounts to the inventory reconciliation; and
(C) select a representative sample of individual receipts of gasoline, gasoline blendstocks, and oxygenates, and trace details back to source documents;
(4) obtain a listing of all gasoline, gasoline blendstocks, and oxygenates sold or dispensed during the period, and
(A) test the mathematical accuracy of the listing;
(B) agree amounts to the inventory reconciliation report; and
(C) select a representative sample of individual batches sold or dispensed both into and outside the control area, and
(i) agree volumes for the sample items to the original bill of lading or other source documents; and
(ii) for sales or deliveries into the control area, determine that oxygenate content meets the required oxygen content standard identified in 18 AAC 53.020 by examining bills of lading;
(5) calculate the oxygen content units by multiplying the required oxygen content identified in 18 AAC 53.020 by the total volume of oxygenated gasoline sold or dispensed into the control area as indicated in the inventory reconciliation report, and agree to the reports submitted to the department as required in 18 AAC 53.100;
(6) calculate the actual total oxygen credit units generated by adding together the oxygen content units of each batch or truckload of oxygenated gasoline that was sold or dispensed in the control area;
(7) calculate the adjusted actual total oxygen content units that are the sum of
(A) the actual total oxygen content units generated in (6) of this subsec-tion; plus
(B) the total oxygen credits purchased or acquired through trade; minus
(C) the total oxygen credits sold or given away through trade;
(8) test the actual total oxygen content units in (6) of this subsection as follows:
(A) for CARs using rack and splash blending, recompute oxygen content by weight for a representative sample of deliveries based on detailed meter readings of gasoline, blendstocks, and oxygenate receipts; and
(B) for CARs using in-tank blending of gasoline, blendstocks, and oxygenates, obtain a register of RWOC by tank and using the individual sample items selected in (3) and (4) of this subsection, test the calculation of running totals; and
(C) for CARs using in-tank blending of gasoline, blendstocks, and oxygenates, and where laboratory analysis is used within the CAR's weighted average calculation, select individual analysis reports of oxygenated gasoline receipts and deliveries during the period on a representative sample basis to
(i) review laboratory results for consistency with the CAR's calculations, noting oxygen volume and specific gravity;
(ii) recalculate oxygen by weight; and
(iii) agree information on laboratory reports to underlying delivery and receiving information;
(9) obtain a register of oxygen credit purchases and sales, and select representative samples of oxygen credits purchased and oxygen credits sold, and
(A) agree selected oxygen credit transactions to the transfer agreement or other supporting documentation, noting the volume and oxygen content of the gasoline associated with the oxygen credits; and
(B) agree to the transfer agreement or other supporting documentation that the
(i) oxygen credits are generated in the same control area as they are used;
(ii) oxygen credits are generated in the same averaging period as they are used;
(iii) ownership of oxygen credits is trans-ferred only between CARs; and
(iv) oxygen credit transfer agreement is made no later than 15 days after the last day of the control period in which the oxygen credits are generated; and
(10) prepare an attestation report to the CAR client that complies with the requirements in (b) of this section, and that indicates the results of performing the attest engagement under this section.
(g) The attestation report required in (f)(10) of this section must include
(1) the description and location of all records reviewed during the attest engage-ment;
(2) the names and positions of all persons responsible for preparing the CAR's reports to the department, including persons who gathered information, operational personnel, and officers;
(3) the location and description of the refinery, import facility, or terminal audited, including its operating procedures and internal controls;
(4) specific reports and examples of calcula-tions performed in the conduct of the attest engagement;
(5) summaries or duplicates of records that support the CPA's findings, analyses, and conclusions; and
(6) a complete list of all discrepancies that the CPA found during the conduct of the attest engagement.
Editor’s note: The document entitled [,] Codification of Statements on Standards for Attestation Engagements, referred to in this section may be reviewed at the department’s Anchorage, Fairbanks, or Juneau offices, or it may be ordered from the American Institute of Certified Public Accountants, P.O. Box 1003, New York, NY 10108-1003 (800-334-6961).
State effective: 10/31/97; EPA effective: 2/28/00