PCAOB staff provides guidance for broker-dealer auditors

BY KEN TYSIAC

The PCAOB staff on Thursday issued new guidance for SEC-registered auditors of brokers and dealers as they make the transition to PCAOB standards from the generally accepted auditing standards (GAAS) that previously governed such audits.

The staff guidance highlights relevant requirements for audits and attestation engagements. It also provides direction on applying PCAOB standards to these engagements, particularly for audits of smaller broker-dealers with operations that are not complex.

“This guidance is tailored to help auditors of smaller broker-dealers develop a cost-effective, scaled approach to their audits,” PCAOB Chairman James Doty said in a news release.

The PCAOB was given oversight authority for audits of brokers and dealers registered with the SEC by the Dodd-Frank Wall Street Reform and Consumer Protection Act, P.L. 111-203. Rule amendments approved by the SEC in July 2013 required that audits of broker-dealers be conducted in accordance with PCAOB standards.

A new auditing standard and two attestation standards applying to broker-dealer audits were adopted by the PCAOB in October 2013 and approved by the SEC in February 2014.

The new rules take effect for fiscal years ending on or after June 1, 2014.

Ken Tysiac ( ktysiac@aicpa.org ) is a JofA editorial director.

SPONSORED REPORT

Click-through nexus: Pushing the boundaries of sales tax compliance

Sales and use tax compliance has been complicated by nexus expansion. In this report, we provide an overview of this issue and include a handy state-by-state summary of click-through nexus or notification requirements.

QUIZ

News quiz: Making allowances for the kids and the economy

Recent news gives CPAs insight into Americans’ attitudes about children and money and gauges outlook on the economy. See how much you know about recent news and reports with this quiz.

CHECKLIST

Auditing risks in culture

Cultural flaws can seriously damage an organization. Here’s how internal auditors can reduce risks by embedding culture audits into existing audit programs.