Regulators are pushing audit firms to take a more serious look at financial statements in 2009, to catch the deluge of financial reporting problems expected to appear after this year’s dizzying market plunge.
The Public Company Accounting Oversight Board has telegraphed that message in the form of a 33-page alert to auditors, telling them to plan their audits with an eye toward the new risks that spring from management acting under economic pressure. Fair-value measurement and management estimates could be particularly contentious, the PCAOB warns, but auditors should also police a laundry list of other concerns: impairments, revenue recognition, restructurings, consolidations, ...