Graduation Year


Date of Submission


Document Type

Campus Only Senior Thesis

Degree Name

Bachelor of Arts



Reader 1

Matthew Magilke

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© 2015 Molly A. Rubidoux


This paper examines the recent application of Statement on Standards for Attestation Engagements 16 (SSAE16) to the escrow industry in southern California. SSAE 16 is a attestation standard issued by the American Institute of Certified Public Accountants (AICPA) in 2011 on the subject of reporting on controls at service organizations. The relationship between service organizations and user organizations has become increasingly complex over the years, which prompted the AICPA to update their previous standard on the subject, SAS 70. This study examines escrow companies as service organizations to lenders, or user organizations. SAS 70 was in effect for 20 years, but it was not widely applied to escrow companies. However, within the past year, SSAE 16 has been very prevalent in the southern California escrow community. This study examines reasons why SSAE 16 is being applied to escrow companies and explores the factors that have contributed to escrow company owner’s perceptions of the standard, as well as their decisions on whether or not to become SSAE 16 compliant. Results show that SSAE 16 is being misapplied to the escrow industry; rather than being used for its intended auditor-to-auditor communication, the standard is being used as a marketing tool.

This thesis is restricted to the Claremont Colleges current faculty, students, and staff.