Auditing


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AUDITING
The PCAOB identified 11 areas in which auditing or quality control deficiencies were observed during inspections of U.S. firms that audited 100 or fewer public companies.

The findings were based on inspections conducted between 2004 and 2006. The PCAOB released a report on the deficiencies to help firms continue to improve quality control and comply with standards.

Areas in which deficiencies were observed were:

Revenue

Related-party transactions

Equity transactions

Business combinations and impairment of assets

Going-concern considerations

Loans and accounts receivable (including allowance accounts)

Service organizations

Use of other auditors

Use of the work of specialists

Independence, including prohibited non-audit services, indemnification and firm independence policies and procedures and independence confirmation with audit committees

Concurring partner review

The report is available at www.pcaobus.org/Inspections/Other/2007/10-22_4010_Report.pdf.

Current Issues in Auditing, the auditing section of the American Accounting Association’s new journal, is now online. Published papers are available free of charge at www.atypon-link.com/AAA/loi/cia. The AAA’s new manuscript management system is at http://ciia.peerx-press.org. The site will serve as the portal for submissions, reviews, and decision letters.

CIIA has accepted papers including The Sarbanes-Oxley Act of 2002—Restoring Investor Confidence, by former U.S. Rep. Michael G. Oxley, R-Ohio, and Top-Ten Wish List for Audit Research, by Edward Nusbaum, CEO of Grant Thornton LLP.

CIIA’s co-editors are Dana R. Hermanson, of Kennesaw State University, and D. Scott Showalter, of KPMG LLP.

SPONSORED REPORT

States look to unclaimed property for revenue

This free report outlines the escheat process, common types of AUP, how different states are handling it and how companies can plan for potential audits and liabilities.

PODCAST

Using drones to enhance audits

Hermann Sidhu, CPA, global assurance digital leader at EY, walks us through EY’s exciting new project to use drones to help audit large warehouses and outdoor inventories.