AICPA monitoring proposed changes to public company auditing oversight

AICPA leadership is monitoring a legislative proposal that would defund the PCAOB, saying in a statement Monday that it “is committed to supporting the drivers of audit quality.”

The House of Representatives’ Financial Services Committee released draft language for a measure that would defund the PCAOB and transfer its activities to the SEC. Under the proposal, transferred duties would include the PCAOB’s inspections and enforcement activities involving firms that audit public companies, as well as rulemaking and standard-setting activities.

“The AICPA believes that healthy oversight of accounting firms that audit listed companies strengthens capital markets and protects the public interest,” AICPA CEO Mark Koziel, CPA, CGMA, said in a statement. “That oversight system involves multiple layers, including timely and transparent audit standard setting and rigorous inspections intended to drive effectiveness and expand knowledge and best practice. It also includes licensing, firm and engagement quality control requirements, and disciplinary activities at the state and federal levels.

“The AICPA continuously engages in activities to support ethical behavior and high-quality performance among CPAs serving the public interest and performing audits. The Auditing Standards Board sets audit standards for U.S. private companies, employee benefit plans, not-for-profit organizations and state and local governments, and attestation standards. Our initiatives include supporting the Center for Audit Quality’s work to promote high-quality audits of listed companies.

“The AICPA is committed to supporting the drivers of audit quality needed to keep the investing public safe and provide confidence in our capital markets. We stand ready to assist policymakers as they consider potential changes to the regulatory infrastructure overseeing public company auditing.”

The PCAOB was created in 2002 by the Sarbanes-Oxley Act.

— To comment on this article or to suggest an idea for another article, contact Bryan Strickland at Bryan.Strickland@aicpa-cima.com.