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.


Get your clients ready for tax season

Upon its enactment in March, the American Rescue Plan Act (ARPA) introduced many new tax changes, some of which retroactively affected 2020 returns. Making the right moves now can help you mitigate any surprises heading into 2022.


Black CPA Centennial, 1921–2021

With 2021 marking the 100th anniversary of the first Black licensed CPA in the United States, a yearlong campaign kicked off to recognize the nation’s Black CPAs and encourage greater progress in diversity, inclusion, and equity in the CPA profession.