PCAOB’s New World of Auditor Reporting Explored
Overview:Two proposals issued by the Public Company Accounting Oversight Board (PCAOB) to expand the auditor's report may significantly affect companies and their audit committees. The PCAOB's transparency proposal would require disclosure of the audit engagement partner's name in the audit report and disclosure of other accounting firms and persons who participated in the audit. The reporting model proposal would require auditors to discuss in the audit report critical auditing matters (CAMs) that arose during the audit. CAMs disclosure could include information about the company's financial reporting that the company itself has not made public. Implementing these proposals could have unintended consequences and would present difficult new challenges for both companies and their auditors.
Daniel L. Goelzer, Partner,
Baker & McKenzie LLP
- Expanding the auditor's report to include discussion of critical audit matters and disclosure of the engagement partner and of other firms that participated in the audit could in some cases be useful to investors. But these changes would also have serious drawbacks.
- CAM disclosure would make the auditor's report an independent source of information about the company, rather simply an attestation to management-created information. This could create confusion regarding the meaning of the auditor's opinion and alter the auditor/client relationship. Many CAMs may be of little or no significance to investors.
Michele B. Amato, CPA, Partner,
- Engagement partner and participating firm disclosure may make it more difficult for audit committees to select the best engagement partner. If a partner was involved in a restatement at another client, investors may question the decision to use that person without getting all the facts. In addition, public offerings could become more difficult and time-consuming, since it would be necessary to obtain consents to liability from the engagement partner and the participating firms.
- There may be more practical alternatives. Audit committee reports could discuss audit and reporting challenges. Engagement partner and participating firm disclosure could be included in be audit firm's annual report to the PCAOB in order to make that information publicly available without requiring consents.
Ivan Cilik, Partner, Audit and Assurance,
- Personal, practical opinions and useful alternatives on all of the proposed topics
Who Should Attend:
- CFOs & Finance Executives
- Internal Controls & Reporting Professionals
- Audit Professionals & Accounting Firms
- Finance & Accounting Attorneys
- Accountants & Consultants
- Other Related/Interested Professionals
Daniel L. Goelzer is a partner in the Washington, DC office of Baker & McKenzie. He practices securities and corporate law, specializing in public company governance and disclosure, financial reporting, and auditor oversight..
Mr. Goelzer was appointed as a founding member of the Public Company Accounting Oversight Board in October 2002. He served on the PCAOB until 2012 and was Acting Chairman from August 2009 through January 2011.
From 1983 to 1990, Mr. Goelzer served as General Counsel of the Securities and Exchange Commission. Before his appointment as General Counsel, he held positions in the Office of the Chairman and the Office of the General Counsel.
From 1990 until joining the PCAOB, Mr. Goelzer was a partner in Baker & McKenzie. He rejoined the firm in December, 2012.
Mr. Goelzer holds BBA and JD degrees from the University of Wisconsin and an LLM from George Washington University.
Daniel L. Goelzer is a partner in the Washington, DC office of Baker & McKenzie. He practices securities and corporate …
Michele Amato is a quality review partner at Friedman LLP. With more than 25 years of experience at both national and regional firms, Michele has an extensive background in auditing standards of the PCAOB and the AICPA, US GAAP and IFRS, as well as SEC compliance. She is the Immediate Past Chair of the New York State Society of Certified Public Accountants’ SEC Committee and is a member of the Center for Audit Quality’s (CAQ) Professional Practice Executive Committee (PPEC). Michele received a B.S. in Business and Economics from Lehigh University.
Michele Amato is a quality review partner at Friedman LLP. With more than 25 years of experience at both national …
With over 13 years of public accounting experience, Ivan is a partner in our audit and accounting services group, playing a key role in our financial institutions, manufacturing, distribution and technology practices.
He has extensive experience with Sarbanes-Oxley section 404 compliance programs and with a variety of technical accounting, auditing, SEC reporting, and internal control issues. In addition, his professional background includes initial public offerings, debt and equity offerings, shelf registrations, mergers and acquisitions, 1933 and 1934 Acts filings and internal controls assessments.
Prior to joining ParenteBeard, Ivan was with a big four firm where he served both privately and publicly held clients in a variety of industries, including financial services, manufacturing, utilities and real estate. Ivan's industry expertise has led to several speaking engagements on technical accounting topics, including International Financial Reporting Standards implementation, SEC compliance and reporting and SOX compliance.
With over 13 years of public accounting experience, Ivan is a partner in our audit and accounting services group, playing …
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2.0 CPE (Not eligible for QAS (On-demand) CPE credits)
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