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Audits Securities and Exchange Commission (SEC) Auditors

Cooley LLP

SEC Approves PCAOB’s ‘Quality Control Standard’ for Audit Firms

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Last week, the SEC approved the PCAOB’s new quality control standard – QC 1000 – that establishes a risk-based quality control framework for independent auditors to follow....more

Baker Botts L.L.P.

In Split Decision, SEC Approves New Audit Quality Control Standard QC 1000

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On September 9, 2024, three of the SEC’s five Commissioners voted to approve the new PCAOB Quality Control Standard QC 1000 A Firm’s System of Quality Control. The new standard will substantially revise and refine public...more

BakerHostetler

SEC Approves PCAOB’s Rule Expanding Contributory Liability

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For nearly two decades since its enactment in 2005, PCAOB Rule 3502 prohibited any “person associated with a registered public accounting” firm from taking or omitting to take an action knowingly or recklessly in a way that...more

Cooley LLP

At open meeting, SEC approves new PCAOB quality control standard

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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

DLA Piper

SEC Approves PCAOB Rule Amendment That Expands Individual Auditor Enforcement Liability

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The Securities and Exchange Commission (SEC) approved a proposed amendment to Public Company Accounting Oversight Board (PCAOB) Rule 3502. The amended rule expands enforcement liability for associated persons who...more

Perkins Coie

SEC’s August 20 Open Meeting: Commissioners Approve Updated Audit Rules

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Yesterday, the SEC held its third open meeting of the 2024 calendar year, at which the commissioners considered several proposals regarding auditors and the audits of public companies. Two of the proposals may be of...more

Cooley LLP

SEC approves new PCAOB proposals

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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

Vedder Price

Highlights from 2024 ALI-CLE Accountants’ Liability Conference

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The annual ALI-CLE Accountants’ Liability Conference occurred in Washington, D.C. on May 16 and 17, 2024 and was co-hosted by Junaid A. Zubairi, Chair of Vedder Price’s Government Investigations and White Collar Defense...more

WilmerHale

PCAOB Releases Summary of 2023 Conversations with Audit Committee Chairs

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One of the stated goals of the Public Company Accounting Oversight Board (PCAOB) is to preserve external audit quality. To further this priority, the PCAOB regularly invites public company audit committee chairs to have...more

Cooley LLP

SEC Chief Accountant issues statement on tone at the top

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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

Cooley LLP

Auditor problems are not just auditor problems

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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

Kohn, Kohn & Colapinto LLP

Whistleblower Awards for Auditors are Key to Meeting OECD Guidelines

According to the Institute of Internal Auditors “Politics of Internal Auditing” (2015), 55% of chief audit executives were directed to commit important findings from their audit reports. 49% of chief audit executives were...more

Troutman Pepper

PCAOB's NOCLAR Proposal in the Hot Seat

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On March 6, the Public Company Accounting Oversight Board (PCAOB) held a virtual roundtable to discuss its June 6, 2023 proposed rule: Amendments to PCAOB Auditing Standards Related to a Company’s Non-Compliance with Laws and...more

Bass, Berry & Sims PLC

SEC Settlement against Auditing Firm Serves as Reminder of Important Independence Rules

On February 29, the Securities and Exchange Commission (the SEC) announced that it settled an administrative proceeding against Lordstown Motors Corps’ former auditor, Clark Schaefer Hackett and Co. (CSH)—the same day that...more

Cooley LLP

SEC Chief Accountant urges focus on professional skepticism and audit quality

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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

Cooley LLP

What’s happening with critical audit matters?

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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

Cooley LLP

The PCAOB suggest some questions for audit committee members

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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

Bass, Berry & Sims PLC

The PCAOB Closes Comment Period on Controversial Proposal to Expand Auditor Responsibility for Legal Compliance

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The Public Company Accounting Oversight Board (PCAOB) recently closed the comment period for its proposal (the Proposal) to significantly increase the responsibility of audit firms to evaluate and disclose a subject public...more

Skadden, Arps, Slate, Meagher & Flom LLP

Comments Raise Concerns About PCAOB’s Proposal To Expand the Scope of Audits and the Role of Auditors

In June 2023, the Public Company Accounting Oversight Board (PCAOB) proposed sweeping amendments to its auditing standards. Comment letters raise serious questions about the consequences of the proposed changes....more

Cooley LLP

SEC Chief Accountant warns against narrow focus in risk assessments

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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

Troutman Pepper

PCAOB Proposes Massive Expansion of the Auditor's Role

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On June 3, the Public Company Accounting Oversight Board (PCAOB) proposed sweeping new auditing standards (PCAOB Release No. 2023-003) that would require auditors to consider a company’s noncompliance with laws and...more

Brownstein Hyatt Farber Schreck

PCAOB Standards Amendments Could Increase Auditor Responsibilities

In early June, the Public Company Accounting Oversight Board (“PCAOB” or “the Board”) proposed comprehensive amendments that impact how auditors consider noncompliance with laws and regulations, creating the possibility of a...more

Akin Gump Strauss Hauer & Feld LLP

“When you are a hammer, the world is a nail” – SEC and PCAOB Senior Staff Signal Increased SEC and PCAOB Gatekeeper Enforcement

Key Points - SEC Enforcement and PCAOB Enforcement both are pursuing more significant sanctions against auditors, particularly with respect to civil money penalties. Expect 2023 enforcement against auditors to focus...more

Cooley LLP

SEC Chief Accountant has advice for audit committees on lead auditors’ use of other auditors

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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

Cooley LLP

Audit committee oversight of ESG fraud risk

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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

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