PCAOB Proposes Enhancements to Lead Auditor’s Oversight of Other Auditors
The Public Company Accounting Oversight Board (“PCAOB”) issued a proposal to strengthen the requirements for a lead auditor’s supervision of other auditors. Offering a more consistent approach, the proposal is intended to increase a lead auditor’s oversight and enhance its ability to avoid or identify deficiencies in the other auditors’ work.
The proposal also introduces a new standard and features amendments to existing standards, such as the following:
- Requiring additional specific procedures that prompt the lead auditor to boost its involvement through increased communications and tougher evaluations of other auditors’ qualifications and work.
- Clarifying that, to serve as lead auditor, an audit firm must audit a significant portion of the financial statements.
- Guiding the lead auditor’s managerial responsibilities to the greatest areas of risk, uniform with the PCAOB’s risk-assessment standards.
Public comments on the proposal are being accepted and must be submitted to the PCAOB by Friday, July 29th.
For the news release on this proposal, visit the PCAOB Web site.