Companies beginning to prepare for year-end audits can get a sense of what might be on their auditors’ minds through a new alert to the profession from the Center for Audit Quality.

The CAQ published its annual year-end audit planning alert to remind auditors of new standards and current flash points that should factor into their audit planning. “It identifies and discusses some of the more judgmental or complex audit areas for the upcoming audit cycle,” the CAQ says in describing the new alert. That includes issues specifically identified as areas of concern by the Securities and Exchange Commission and the Public Company Accounting Oversight Board.

In addition to the ongoing concerns around auditing anything that involves judgment and estimates, the alert calls out tricky areas like cyber-security, auditor independence, related-party transactions, and technology, segment identification and disclosures, and the going concern analysis. The CAQ tells auditors to be sure they understand how estimates are developed and to be sure to test data and evaluate assumptions used by management that are important to estimates.

Auditors also are reminded to be sure they look not just at evidence that confirms such estimates and assumptions, but also any contradictory evidence. “Growing merger and acquisition activity presents additional audit risk due to increasing complexity of estimates related to growing deal values,” the alert says. Such an environment might increase the risk of improper valuation of assets and liabilities involved in deals that keep getting bigger and more complex.

In terms of new accounting standards, the alert calls out the special focus at Securities and Exchange Commission on disclosures around how companies are preparing for and implementing pending new rules, especially those for revenue recognition, leases, and financial instruments. Around revenue recognition in particular the SEC has advised companies to pay attention to how they will adapt their controls, processes and procedures to transition to the new standard.

The alert says: “The auditor has a responsibility to evaluate whether the issuer’s presentation of the financial statements and the related disclosures are in conformity with the applicable financial reporting framework, which includes the issuer’s evaluation of the effect the new revenue recognition standard will have on its financial statements. The auditor should also consider what information should be communicated to the issuer’s audit committee about the anticipated application of the new revenue recognition standard.”

The CAQ also cautions auditors to be mindful of standards and areas of regulatory focus specifically for auditors. That includes a new reporting process whereby audit firms will be identifying engagement partners for each public company audit report they issue, as well as alerts from the PCAOB on communication with audit committees, alteration of audit documentation, and assessing and responding to material misstatement risks.

The CAQ also published a separate audit alert targeted to auditors of broker-dealers.