Standing Advisory Group Nominees Being Accepted
Nominations are being accepted for the 2018-2020 term of the Public Company Accounting Oversight Board’s (“PCAOB”) Standing Advisory Group (“SAG”). Announced in its June 13 press release , the PCAOB seeks candidates with accounting, auditing, corporate finance, corporate governance, or investing experience. Nominees familiar with auditing or financial reporting for broker-dealers and small public businesses are also requested. Self-nominations are also permitted. SAG nominee submissions are due by Saturday, August 12. Selected individuals will be announced in December, and will begin serving three-year terms in January 2018.
PCAOB Wants to Improve Rules for Work of Specialists
Seeking to reinforce the applicable requirements for auditors that use the work of specialists in an audit, the Public Company Accounting Oversight Board (“PCAOB”) has issued the proposal, Proposed Amendments to Auditing Standards for Auditor’s Use of the Work of Specialists. The proposal aims to advance investor protection by improving the requirements for reviewing the work of company specialists, and applying a risk-based method to assessing the work of a specialist hired by the auditor. Specialists are often hired or appointed by companies to offer information used in preparing financial statements, and their work is frequently used as audit evidence.. Read More.
PCAOB Proposal to Address Auditing Accounting Estimates
A new proposal by the Public Company Accounting Oversight Board (“PCAOB”) seeks to strengthen the applicable requirements for auditing accounting estimates. Issued as Proposed Auditing Standard for Auditing Accounting Estimates, Including Fair Value Measurements, the proposal advises auditors to use professional skepticism and give added attention to possible management bias while auditing accounting estimates. Auditors have had issues auditing some accounting estimates, causing PCAOB inspectors to flag deficiencies at both small and large audit firms. Such deficiencies have raised concerns on auditors’ application of professional skepticism and their consideration of possible management bias. In response, the PCAOB proposes a new. Read More.
Topics: and Investments in Securities (AS 2503), Auditing, Auditing Accounting Estimates (AS 2501), Auditing Derivative Instruments, Auditing Fair Value Measurements and Disclosures (AS 2502), Fair Value Measurements, Hedging Activities, PCAOB, Public Company Accounting Oversight Board "PCAOB"
Financial Restatements Lowest in 15 Years
Audit Analytics is reporting the lowest total number of financial restatements among publicly traded companies since 2002. In its May report, Audit Analytics said restatements dropped 6.83 percent last year (671 companies). Separately, the percentage of financial restatements in 2016 was the lowest since 2007. Regulatory oversight is receiving partial credit for the low numbers. Audit Analytics Director of Research Don Whalen was not surprised by the downward trend, saying that improved internal controls over financial reporting have helped companies. Whalen noted the improved internal controls are due largely to the Public Company Accounting Oversight Board’s efforts and the Committee. Read More.
PCAOB Considering Revenue Recognition Interpretive Guidance for Auditors
Auditors could receive interpretive guidance on the Financial Accounting Standards Board’s (“FASB”) revenue recognition standard. Last month, Public Company Accounting Oversight Board (“PCAOB”) Chief Auditor Martin Baumann said a project is in the works to determine what type of guide the board should release concerning Accounting Standards Update (“ASU”) No. 2014-09, Revenue From Contracts With Customers (Topic 606). To help public companies implement ASU No. 2014-09, Baumann remarked that the PCAOB is considering releasing an Audit Practice Alert. The PCAOB staff has already reviewed Staff Audit Practice Alert (“APA”) No. 12, Matters Related to Auditing Revenue in an Audit of. Read More.
Topics: Accounting Standards Update "ASU", Audit Practice Alert, audits, FASB, FASB Accounting Standards Codification, Financial Accounting Standards Board "FASB", PCAOB, Public Company Accounting Oversight Board "PCAOB", Revenue from Contracts with Customers (Topic 606), Revenue Recognition, Staff Audit Practice Alert
PCAOB Approves Expanded Auditor’s Report
In a unanimous decision, the Public Company Accounting Oversight Board (“PCAOB”) has approved a rule to expand auditor reports in a Securities and Exchange Commission (“SEC”) filing. Announced on June 1, the new format will make filed auditor reports more valuable to investors. The rule requires a public company’s external auditor to disclose any critical audit matters that arise while auditing their clients, and provide details on clients’ financial reporting procedures. Such requirements are listed under Release No. 2017-001, The Auditor’s Report on an Audit of Financial Statements When the Auditor Expresses an Unqualified Opinion and Related Amendments to PCAOB. Read More.