AccountingLink

    PCAOB

    Summary
    The Public Company Accounting Oversight Board (PCAOB) is a nonprofit corporation established by Congress to oversee the audits of public companies in order to protect investors and the public interest by promoting informative, accurate, and independent audit reports.

    Proposed rules
    EY comment letters
    Selected PCAOB speeches
    Selected news releases

    Proposed rules

    1 June 2017

    Proposed amendments to auditing standards for auditor's use of the work of specialists
    The PCAOB issued for public comment a proposal to strengthen requirements that would apply when auditors use the work of specialists in an audit. The proposal is intended to further investor protection by strengthening the requirements for evaluating the work of a specialist employed or engaged by the company and applying a risk-based approach to supervising and evaluating the work of a specialist employed or engaged by the auditor. Comments are due by 30 August 2017.

    1 June 2017

    Proposed auditing standard for auditing accounting estimates, including fair value measurements
    The PCAO issued for public comment a proposal to enhance the requirements that apply when auditing accounting estimates, including fair value measurements. The proposal emphasizes that auditors need to apply professional skepticism and devote greater attention to potential management bias when auditing accounting estimates. Comments are due by 30 August 2017.

    EY comment letters

    10 September 2018

    Comment Letter - PCAOB Draft Strategic Plan for 2018-2022
    In our comment letter on the PCAOB’s Draft Strategic Plan for 2018-2022, we commend the PCAOB for seeking public input and generally support the five goals the PCAOB laid out. We also offer suggestions to enhance inspection reporting, strengthen the PCAOB’s goal relating to technological innovations and expand the stakeholders with which the PCAOB engages to include foreign regulators and international standard setters. The PCAOB is expected to publish its final Strategic Plan by the end of the year.

    15 November 2017

    Comment Letter - PCAOB supplemental request for comment on proposal on audits involving other auditors
    In our comment letter, we continued to support the PCAOB’s efforts to strengthen the requirements for the lead auditor in an audit involving other auditors. However, we recommended ways to make the proposal more practical, particularly the proposed requirements related to compliance with independence and ethics requirements and the qualifications of other auditors.

    30 August 2017

    Comment Letter - PCAOB proposal on auditing estimates
    In our comment letter, we supported the PCAOB’s proposal to strengthen the requirements for auditing accounting estimates, including fair value measurements. However, we believe certain aspects of the proposal could be improved or made more practical, particularly the proposed requirements relating to the use of pricing information from third parties and the valuation of investments based on an investee’s financial condition or operating results.

    30 August 2017

    Comment Letter - PCAOB proposal on using the work of specialists
    In our comment letter, we supported the PCAOB’s proposal to strengthen the requirements for using the work of specialists. We asked the PCAOB to clarify some of the proposed requirements for using the work of a company specialist that we believe could be interpreted as requiring auditors to do significantly more work than they currently do. In addition, we expressed concerns regarding the proposal to rescind Auditing Interpretation 11, Using the Work of a Specialist: Auditing Interpretations of AS 1210, which we believe provides important prescriptive guidance and examples to help auditors assess the level of assurance obtained from legal opinions.

    Selected PCAOB speeches

    5 December 2017

    Board Member Jeanette M. Franzel address at the AICPA Conference on Current SEC and PCAOB Developments
    Board Member Jeanette M. Franzel gave an update on PCAOB efforts to enhance audit quality.

    4 December 2017

    Chairman James R. Doty address at the AICPA Conference on Current SEC and PCAOB Developments
    Chairman James R. Doty spoke about the PCAOB’s initiatives to bolster investor trust in the audit.

    Selected news releases

    13 September 2018

    PCAOB enters into cooperative agreement with Austrian audit regulator
    The PCAOB announced that it has entered into a cooperative agreement with the Audit Oversight Body of Austria. This agreement provides a framework for joint inspections in the oversight of audit firms subject to the regulatory jurisdictions of both organizations. It also allows for the exchange of confidential information.

    23 August 2018

    PCAOB posts updated staff guidance on changes to the Auditor's Report
    The PCAOB published updated Staff Guidance on Changes to the Auditor’s Report (updated August 23, 2018).

    20 August 2018

    PCAOB report on 2017 inspections of broker-dealer auditors shows audit deficiencies remained high, while fewer independence violations were found
    The PCAOB issued a report on its inspections in 2017 of auditors of brokers and dealers that shows a continued high number of audit deficiencies overall, and fewer independence violations than in previous years. The PCAOB also issued Executive Highlights of the report.

    10 August 2018

    PCAOB seeks public comment on its draft five-year strategic plan
    The PCAOB released a draft of its five-year strategic plan, for the first time inviting public comment on its areas of strategic focus in fulfilling its mission to protect investors and the public interest through high quality audit reports. The PCAOB's strategic plan serves as a roadmap for the organization, as well as the basis for its budget each year. Comments are due by 10 September 2018.

    10 April 2018

    PCAOB announces 2018 fForums on aAuditing in the small business environment and on auditing broker-dealers
    The PCAOB announced the 2018 Forums on Auditing in the Small Business Environment and Forums for Auditors of Broker-Dealers. Forums are live meetings and are open to members of PCAOB-registered firms that audit public companies or broker-dealers.

    4 December 2017

    PCAOB publishes staff guidance on implementing changes to auditor's report
    The PCAOB published staff guidance that describes changes to the auditor's report that become effective for audits for fiscal years ending on or after 15 December 2017. The guidance addresses key changes to the auditor's report required this year, such as the form of the auditor's report, disclosure of auditor tenure, a statement on auditor independence, and a required explanatory paragraph on Internal Control Over Financial Reporting in certain circumstances.

    28 November 2017

    PCAOB to hold webinars on implementing recent changes to the auditor's report on 12 December and 10 January
    The PCOAB will host webinars on Tuesday, 12 December 2017, and Wednesday, 10 January 2018, on the implementation of recent changes to the auditor's report that become effective for audits of financial statements for fiscal years ending on or after 15 December 2017.

    21 September 2017

    PCAOB to hold open meeting to consider supplemental request for comment on new requirements for an auditor’s use of other auditors
    The Public Company Accounting Oversight Board will hold an Open Meeting on Tuesday, 26 September at 9 a.m., to consider issuing a supplemental request for comment on certain revisions to new requirements proposed last year that would apply to audits that involve auditors outside the firm issuing the audit report.

    30 August 2017

    PCAOB publishes staff inspection brief providing information about 2017 inspections of auditors of public companies
    The PCAOB published a staff inspection brief providing information about its ongoing 2017 inspections of auditors of public companies and other issuers. The brief is intended to help investors, auditors, and others understand the areas of significant audit risks targeted by PCAOB inspectors, and encourage auditors to work to improve audit quality.

    18 August 2017

    PCAOB annual report on 2016 inspections of broker-dealer auditors shows continued high level of audit deficiencies
    The PCAOB issued a report on its inspections in 2016 of auditors of brokers and dealers that shows a continued high level of audit deficiencies. PCAOB inspectors observed deficiencies at 97 percent of the firms inspected in 2016, compared to 96 percent in 2015.

    6 July 2017

    PCAOB posts standard-setting update
    The PCAOB posted to its website a standard-setting update on the current standard-setting projects and the research agenda.

    24 May 2017

    PCAOB to hold open meeting 1 June to consider adopting standard on the auditor’s report, and proposing updated requirements for auditing accounting estimates and an auditor’s use of the work of specialists
    The PCAOB announced that it will hold an Open Meeting on Thursday, 1 June at 2:30 p.m., to consider adopting a standard that would provide additional information in the auditor's report. The Board also will consider proposing amendments to standards that would strengthen and enhance requirements for auditing accounting estimates, including fair value measurements, and using the work of specialists in an audit.

    28 March 2017

    PCAOB posts updated data on characteristics of emerging growth companies
    The PCAOB posted to its website the most recent report on the characteristics of emerging growth companies prepared by its Office of Research and Analysis.

    18 August 2016

    PCAOB issues annual report on inspections of broker-dealer auditors
    The PCAOB issued an annual report on its interim inspection program for auditors of brokers and dealers. The annual report describes results of inspections conducted in 2015, the first inspection year in which all inspected engagements were governed by the SEC’s 2013 amendments to Exchange Act Rule 17a-5, including the new requirement that broker-dealer audits be performed in accordance with PCAOB standards. The report shows high levels of deficiencies similar to inspection results in previous years.