The auditor's report is the primary means by which the auditor communicates to investors and other users of audited financial statements regarding its opinion on those statements. discussed its standard-setting initiative on the auditor's reporting model, and outlined plans to conduct outreach to identify additional investor and user needs to present to the Board
The auditor is in a unique position to provide relevant and useful information, because of the auditor's extensive knowledge of the company and as an independent third-party several alternatives for changing the auditor's reporting model and is seeking specific comment on these or other alternatives that could provide investors with more transparency in the audit process and more insight into the company's financial statements or other information outside the financial statements. These alternatives include:
An auditor's discussion and analysis;
Required and expanded use of emphasis paragraphs;
Auditor assurance on other information outside the financial statements; and,
Clarification of language in the standard auditor's report.
Partner’s Information Disclosed the Board did not include in this proposal a requirement to sign the engagement partner's name on the audit report. Instead, the proposal would require that the engagement partner's name be disclosed in the audit report, which would make the engagement partner's name readily available to the users of the audit report while mitigating concerns about minimizing the firm's role in the audit.
The proposed disclosure would enable investors to evaluate the other participants in the audit in the same manner that they evaluate the auditor. For example, knowing the name of a disclosed accounting firm that took part in the audit would enable investors to determine whether the firm is registered with the Board and has been subject to PCAOB inspection, or is located in a country that does not allow PCAOB inspections. Investors would also be able to verify whether a disclosed firm or person has had any publicly available disciplinary history with the PCAOB or other regulators.
International Cooperative Agreements
The SOX directed the PCAOB to oversee and periodically inspect all accounting firms that regularly audit companies whose securities trade in U.S. markets.
Cooperative agreement with foreign regulators enables the PCAOB to carry out joint inspections of PCAOB registered firms with its foreign counterparts.
Also authorizes the PCAOB and the foreign regulators to exchange confidential information, consistent with the provisions of the 2010 Dodd-Frank Act. Those provisions amended the SOX to permit the PCAOB to share confidential information with its non-U.S. counterparts under certain circumstances.
More than 900 audit firms currently registered with the PCAOB are located outside of the United States, in 85 countries.
Enables to work together to promote public trust in the audit process and investor confidence in capital markets.
Cooperative countries include Dubai, Taiwan, Israel, Norway, Netherlands, Swiss, Japan and the UK.
In the process of working…