All PCAOB articles – Page 23
-
Blog
PCAOB Gives Audit Committees Oversight Cheat Sheet
As inspectors begin looking at 2014 public company audit files, they will be tuning in to emerging market risks around mergers and acquisitions, falling oil prices, undistributed foreign earnings, and the quality of audit work as firms grow other business lines. The PCAOB published a new paper reaching out to ...
-
Blog
SEC Ponders Tension Over Management Review Controls
Image: Amid continued tension over what it takes to satisfy auditors and regulators with respect to management review controls, the SEC is pondering whether some kind of new guidance might be in order. Deputy Chief Accountant Brian Croteau said recently, “It’s not an area that seems to be improving. So ...
-
Article
Audit Inspections: Improvement? Maybe. Costs? Yes.
Image: Five years of increasingly rigorous PCAOB inspections have driven audit firms to improve their efforts at scrutinizing corporate financial statements and internal control. Companies receiving that pressure say the heightened scrutiny is clear; the question is whether it is making audits better, or just bigger and more expensive. “Companies ...
-
Blog
Study Shows No Better Reporting After Auditors Cut Tax Services
U.S. auditor independence rules targeted at tax work have done nothing to improve financial reporting quality, according to new academic research out of Singapore. The study found a big shift in non-audit services provided by audit firms, leading to a significant drop in auditor-provided tax services, especially among firms that ...
-
Article
PCAOB Inspection Data: Shifting Standards, Shifting Insights
Image: If you want to be panicky or cynical about audit firms’ performance, citing failure rates in PCAOB inspection reports is a great way to do it. The truth is more complex. In Part II of our series looking at PCAOB inspection data, we delve into how inspections have changed ...
-
Blog
PCAOB Routs Nevada Firm Where Beckstead Landed
The PCAOB has thrown the book at a small Nevada audit firm for a long list of audit violations, including a suspension for Brad Beckstead, former partner with Beckstead and Watts. Beckstead challenged audit inspections and the existence of the PCAOB before the U.S. Supreme Court, which has created uncertainty ...
-
Blog
PCAOB Reorganizes Auditing Standards by Topic
The PCAOB is reorganizing its audit standards, integrating standards the board wrote with historical standards it adopted on an interim basis under Sarbanes-Oxley. “The standards will be organized by topics that generally follow the flow of the audit process, making their use easier and more efficient for auditors,” said PCAOB ...
-
Blog
Study Finds Blind Spot in Audit Quality Reviews
New research suggests audit reviewers may sometimes give audit teams the benefit of the doubt when reviewing a team’s work. The study found reviewers who had no knowledge of any ill feelings on the part of the audit manager reached judgments consistent with the audit evidence. Those who were aware ...
-
Blog
Aguilar: SEC Must Extend Its Global Reach
SEC Commissioner Luis Aguilar, an outspoken proponent of stronger agency oversight, says the regulator must do more to extend its global reach. In a recent speech, Aguilar framed the SEC’s imperative simply: “As companies increasingly have foreign operations, the SEC will need to address how best to extend its supervisory ...
-
Article
Audit Voices Try to Calm Tensions on Evidence
Image: Leaders of the auditing world are calling for a truce in arguments between internal and external auditors over how much evidence external auditors should collect themselves while scrutinizing internal controls—and are calling on audit committees to intervene earlier to prevent such disputes. “Essential value will be lost if external ...
-
Blog
Deloitte Advances Ucuzoglu to Lead Audit Practice
Image: After Deloitte advanced its head of audit to CEO in February, the firm has appointed Joseph Ucuzoglu chairman and CEO of subsidiary Deloitte & Touche. Ucuzoglu says he has a handful of near-term priorities that focus on innovating the audit practice to elevate audit quality. “We want to really ...
-
Blog
Franzel Reveals Progress in Internal Control Audits
Image: PCAOB member Jeanette Franzel said to expect improvements in the audit of internal control once 2014 audit inspections are published. “Preliminary results of the 2014 inspections indicate that some improvements have been seen in the area of auditing internal control,” Franzel said at the recent IIA annual conference. “That ...
-
Blog
PCAOB Wraps 2013 Reports With Grant Thornton
The Public Company Accounting Oversight Board has published a tough report on Grant Thornton, finding problems in 20 of 36 audits inspected, a failure rate of 55 percent. Inspectors said the deficiencies were significant enough to conclude auditors did not obtain sufficient audit evidence before arriving at their conclusions. Details ...
-
Blog
Globally, Audit Inspectors Find Big Problems
U.S. audit regulators are not the only ones alarmed by high rates of busted audits. Around the globe, audit regulators who are members of the International Forum of Independent Audit Regulators compared notes and found nearly half of the audits they inspected in 2014 contained deficiencies that suggest the audit ...
-
Blog
Shareholder Wins Bid to Amend Audit Committee Rules
A recent letter from the Securities and Exchange Commission denies Citigroup’s proposal to bar a person with a history of bankruptcy from joining the audit committee. The Commission said it disagrees with Citi that a shareholder proposal to pursue a bylaw amendment on audit committee service should be excluded from ...
-
Article
Dueling Thresholds Emerge on Going-Concern Warnings
Image: A new accounting standard meant to give investors more warning of when a company is in trouble could actually lead to less warning of trouble. Audit and accounting professionals are struggling over conflicting interpretations of “substantial doubt,” and the answer is not easy. “I’m not sure if the standard ...
-
Blog
SEC Approves PCAOB Budget, Wants Improvements
Image: The SEC has approved a 2015 budget of $250.9 million for the PCAOB, 3 percent less than its 2014 budget but 8 percent more than the board actually spent in 2014. PCAOB Chairman James Doty said that the decrease “reflects an appropriate reassessment of assumptions relating to personnel and ...
-
Article
More Hints on Audit Report 2.0
New international requirements for an expanded audit report are providing a teaser for what the United States should expect in coming years. The new international standard is modeled on an earlier U.K. version, and it’s similar to a proposal expected from the PCAOB this year. The details differ, but the ...
-
Blog
Study Says Investors Need to Know About Audit Offshoring
Apparently doubting the quality of the audit, investors punish companies when they first learn that others from outside the principal audit firm had a hand in assuring the company’s financial statements.
-
Article
Recognize the Big Standards’ Changes
The auditing and financial reporting world will spend lots of 2015 preparing for the new revenue recognition standard going into effect by 2017—but from leasing to going concern warnings to IFRS adoption in the United States, plenty of other major changes may arrive as well. “Folks have come to see ...