Yesterday, the SEC approved, by a vote of three to two, a new PCAOB quality control standard, QC 1000, A Firm’s System of Quality Control, and related amendments to its standards, rules and forms. According to the press...more
In this 2023 article in Fortune, a survey of 2,800 managers and executives conducted by management consulting firm Aon showed that business leaders “weren’t very concerned about AI….Not only is AI not the top risk that they...more
Yesterday, the SEC held an open meeting to consider a number of PCAOB proposals addressing the “general responsibilities of an auditor conducting an audit as well as technology-assisted analysis and contributory liability...more
In this statement, SEC Chief Accountant Paul Munter discusses the importance of setting the tone at the top. According to Munter, “academic research has ‘long stressed the crucial role that tone at the top, set by...more
On Friday, SEC Enforcement charged audit firm BF Borgers CPA PC and its owner, Benjamin F. Borgers, with “massive fraud” involving “deliberate and systemic failures” to comply with PCAOB standards in auditing and reviewing...more
The Center for Audit Quality has released its 2024 “Audit Committee Practices Report: Common Threads Across Audit Committees.” The report highlights the top five audit committee priorities identified by committee members in...more
SEC Chief Accountant Paul Munter has posted a new Statement. What’s on his mind? Apparently, he is disturbed that, in recent inspections of audits, the PCAOB has reported a “troubling” increase in deficiency rates—meaning...more
Ideagen AuditAnalytics has just released its 2024 Report on Critical Audit Matters, a 3-Year Review, covering the years 2020 to 2022. Under the auditing standard for the auditor’s report (AS 3101), adopted in 2017, CAMs are...more
In this brand new report, The Conference Board looked at several of the less glitzy areas of board governance to identify some evolving best practices for attaining board excellence, such as board continuing education. From...more
The Center for Audit Quality, working with Ideagen Audit Analytics, has just released a new edition of its annual Audit Committee Transparency Barometer, which, over the past ten years, has measured the robustness of audit...more
The SEC’s Office of Chief Accountant appears to be taking a hard look these days at statements of cash flows. In “The Statement of Cash Flows: Improving the Quality of Cash Flow Information Provided to Investors,” SEC Chief...more
The PCAOB has posted a 2023 audit committee resource that identifies a number of questions that audit committees may want “to consider amongst themselves or in discussions with their independent auditors, particularly given...more
In this Statement, The Importance of a Comprehensive Risk Assessment by Auditors and Management, SEC Chief Accountant Paul Munter cautions auditors and company managements against conducting risk assessments that focus too...more
In May, SEC Chief Accountant Paul Munter, quoted here, cautioned his conference audience about the potential for audit committee overload. “More demands are being put on audit committees, sometimes on topics outside their...more
Last month, Cornerstone Research told us that accounting and auditing enforcement activity by the SEC in FY 2022 increased by 55% over the prior fiscal year to 68 enforcement actions, 25 of which alleged improper revenue...more
In this report from Cornerstone Research, SEC Accounting and Auditing Enforcement Activity—Year in Review: FY 2022, Cornerstone tells us that accounting and auditing enforcement activity by the SEC increased sharply in FY...more
Under the pressure of institutional investors, environmental groups, employees, consumers and other stakeholders, many companies have sought to demonstrate their bona fides when it comes to ESG through disclosure about their...more
In this new statement, SEC Chief Accountant Paul Munter—no longer “acting” Chief, he got the job—discusses some of the issues arising out of the increased use by lead auditors of other accounting firms and individual...more
In this article, accounting firm Deloitte observes that boards and managements often experience “denial” when the topic of fraud risk arises—no one wants to feel that the trust they place in their own employees is actually...more
You might recall that, for well over a decade, the PCAOB has been unable to fulfill its SOX mandate to inspect audit firms in “Non-Cooperating Jurisdictions,” including China. Years of negotiation failed to resolve the...more
Last week, the SEC brought a settled action against VMware, a provider of cloud-storage software and services, alleging that it misled shareholders by failing to disclose material information about its “managed pipeline” of...more
For well over a decade, the PCAOB has been unable to fulfill its SOX mandate to inspect audit firms in “Non-Cooperating Jurisdictions,” or “NCJs,” including China. To address this issue, in December 2020, the Holding Foreign...more
At the end of last week, the SEC approved the PCAOB’s updated standards for audits that involve multiple auditing firms. SEC Chair Gary Gensler said that the amended standards “will strengthen the requirements for lead...more
SEC Chair Gary Gensler may just have some paternal affection for SOX, especially on the week of its 20th birthday. In these remarks to the Center for Audit Quality, he recalls having “a front-row seat” for the negotiations...more
In December 2020, the Holding Foreign Companies Accountable Act, co-sponsored by Senators John Kennedy, a Republican from Louisiana, and Chris Van Hollen, a Democrat from Maryland, was signed into law. The HFCAA amended SOX...more