PCAOB issues staff guidance on audit evidence from other sources

By Ken Tysiac

The PCAOB issued staff guidance Thursday on things for auditors to consider regarding the relevance and reliability of information from external sources that the auditor plans to use as audit evidence.

In addition, the guidance addresses the relationship between the quality and quantity of audit evidence.

The board's staff has learned through outreach that expanded use of information from sources external to the company is affecting the volume and nature of information that auditors can use during engagements.

In particular, advancements in technology have expanded the volume of information available to companies and their auditors. Traditional sources of information such as regulatory agencies and industry data providers are making information more accessible.

For example, interactive applications that can provide real-time industry data such as occupancy rates and trend reports used in the hospitality industry may be available to companies and their auditors.

New nontraditional sources such as web data aggregators and social media platforms also are making information available to companies and auditors. Product reviews, weather patterns, and customer web traffic may be used to inform business and financial reporting decisions.

The PCAOB staff report addresses these issues related to auditing.

Ken Tysiac (Kenneth.Tysiac@aicpa-cima.com) is the JofA's editorial director.

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