PCAOB moves to strengthen lead auditor’s oversight of other auditors

PCAOB moves to strengthen lead auditor’s oversight of other auditors

September 28, 2021

Published: Journal of Accountancy

The lead auditor’s role in planning and executing a public company audit that involves other auditors would be enhanced under a proposal posted Tuesday in a second supplemental request for comment by the PCAOB.

The PCAOB has been looking for years to strengthen requirements that apply to audits involving accounting firms and individual auditors that are outside the accounting firm that issues the auditor’s report.

In 2016, the PCAOB issued a proposal to guide lead auditors in supervision of auditors outside their firms. The following year, the board issued a first supplementary request for comment on clarifications and revisions to the proposal.

The additional supplementary request for comment proposes amendments that are intended to:

  • Adjust certain requirements to better take into account the lead auditor’s role in the audit, and
  • Improve the readability and usability of the proposed amendments and facilitate their implementation.

Comments can be emailed to comments@pcaobus.org.

The proposal is intended to address the challenges posed when the lead auditor issues the auditor’s report but other auditors perform important work to assist the lead auditor in obtaining sufficient appropriate audit evidence. The international nature of business has led to the need for additional auditors — sometimes many of them — to assist the lead auditor in multiple jurisdictions.

PCAOB Acting Chair Duane DesParte said during an open meeting Tuesday that about 30% of issuer audits involve other auditors outside the firm that issues the auditor’s report. In one case, the PCAOB identified as many as 65 audit firms involved in a single audit.



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