The Public Company Accounting Oversight Board (PCAOB) issued 2018 inspection reports on June 1 for the six largest U.S. audit firms, including each of the Big Four, BDO, and Grant Thornton.
These annual inspection reports are the first in a new format intended to be more readable, with streamlined content and more charts and graphs. They contain new information, including a section on significant audit deficiencies (Part I.A), a classification system for audits with identified deficiencies, and a section with other instances of non-compliance with PCAOB standards or rules (Part I.B). Items included in Part I.A are deficiencies of such significance that the PCAOB believes the firm, at the time it issued its audit report, had not obtained sufficient appropriate audit evidence to support its opinion on the issuer’s financial statements and/or internal control over financial reporting (ICFR).
