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The PCAOB voted to adopt Auditing Standard no. 6, Evaluating Consistency of Financial Statements, and an accompanying set of amendments to the Board's interim auditing standards.
The new standard and related amendments update the auditor's responsibilities to evaluate and report on the consistency of a company's financial statements and align the auditor's responsibilities with Statement of Financial Accounting Standards no. 154, Accounting Changes and Error Corrections. AS6 clarifies that the auditor's report should indicate whether an adjustment to previously issued financial statements results from a change in accounting principle or the correction of a misstatement. The PCAOB also removed the GAAP hierarchy from its interim auditing standards because FASB intends to incorporate the hierarchy into the accounting standards.
The standard (available at www.pcaobus.org/Rules/Docket_023/PCAOB_ Release_No._2008-001_--_Evaluating_ Consistency.pdf ) and amendments become effective 60 days after SEC approval.