The Public Company Accounting Oversight Board (PCAOB) issued guidance in the form of questions and answers (Qs & As) for auditors ( www.pcaobus.org/standards/staff_questions_and_answers/index.asp ). They concern attest engagements relating to information that companies furnish under the SEC’s XBRL Voluntary Financial Reporting Program on the EDGAR system ( www.sec.gov/spotlight/xbrl.htm ). The Qs & As provide independent auditors with performance and reporting guidance when the auditor is engaged to report on whether a company’s voluntarily filed XBRL data accurately reflect the corresponding information in its official EDGAR filings.
The AICPA Auditing Standards Board (ASB) laid the groundwork for this guidance with its AT 101 Interpretation, Attest Engagements on Financial Information Included in XBRL Instance Documents, issued in September 2003. The AICPA XBRL Assurance Task Force soon will issue an illustrative examination program for practitioners.
The SEC program does not require public companies to obtain an auditor’s attestation regarding the XBRL data. But if a public company voluntarily chooses to obtain such an attestation, it should consult the PCAOB’s Qs & As for practical guidance.
The Auditing Standards Board (ASB) has exposed ( www.aicpa.org/members/div/auditstd/ ) several risk assessment standards that it originally exposed in 2002 and an amendment to Statement on Auditing Standard (SAS) no. 1, Due Professional Care in the Performance of Work (AU sec. 230). If approved, the proposed SASs would establish standards and provide guidance on the auditor’s assessment of the risks of material misstatements in a financial statement audit, on the design and performance of audit procedures whose nature, timing and extent respond to the assessed risks and on planning and supervision, audit evidence and audit risk and materiality. Comments are due August 15, 2005.