Health care regulations associated with the Patient Protection and Affordable Care Act (PPACA), P.L. 111-148, have created new opportunities for internal auditors. But internal auditors may need to get more familiar with PPACA’s provisions to help their organizations understand the risks associated with the law and their organization’s preparedness to
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Audit & assurance
PCAOB establishing Center for Economic Analysis
The PCAOB is establishing a Center for Economic Analysis to advise the board on how economic theory, analysis, and tools can enhance the effectiveness of the board’s programs. University of Chicago economist Luigi Zingales will be the founding director of the center, which will promote and encourage economic research related
When the rules and the law no longer agree
In 2012, a form required by the New York City Tax Commission left auditors in a quandary. Recent changes to GAAS that revised the wording of the auditor’s report had not been reflected in the form. As a result, the form required auditors to submit a report to the Tax
PCAOB standard for auditing revenue may be on the horizon
Auditing revenue will need to be an area of focus for PCAOB standard setting in the near future, PCAOB member Jay Hanson said in a speech Monday. FASB and the International Accounting Standards Board are in the closing stages of developing a converged financial reporting standard for revenue recognition. The
PCAOB continues focus on audits of internal control over financial reporting
The PCAOB maintained its focus on audits of internal control over financial reporting (ICFR) Thursday by issuing its second report in 11 months on the subject. Staff Audit Practice Alert No. 11, Considerations for Audits of Internal Control Over Financial Reporting, discusses application of PCAOB standards to audits of internal
UK regulator creates 10-year retendering requirement
Companies in the U.K. FTSE 350 will be required to place their audit contracts out for bid every 10 years under new rules announced Tuesday by the U.K. Competition Commission (CC). The rules represent a softening of the five-year mandatory retendering proposed earlier by the CC. Some businesses and regulators,
PCAOB approves standards for auditors of broker-dealers
The PCAOB on Thursday approved new standards for auditors of brokers and dealers. Two new attestation standards are designed to help protect customer funds by establishing rules for examinations and reviews of compliance information that broker-dealers submit to the SEC. A new auditing standard applies to procedures performed and reporting
ARSC to propose new preparation, compilation, association standards
From Staff Reports Three new standards the AICPA Accounting and Review Services Committee (ARSC) voted Thursday to propose would help practitioners clearly distinguish between preparation and reporting services. ARSC voted to expose for public comment proposals titled Preparation of Financial Statements, Compilation Engagements, and Association With Financial Statements. An exposure
Five key objectives for in-demand internal auditors
The perception of internal audit as a function that can add value in addition to enforcing compliance is placing importance on several objectives for internal auditors. “I think the expectation from the executive suite has increased,” PwC’s Walter Smiechewicz, CPA, said in a telephone interview. “And they are looking for
PCAOB to consider adopting broker-dealer audit standards
The PCAOB will meet at 9:30 a.m. Thursday to consider adopting attestation standards for auditors of brokers and dealers. A new standard on auditing supplemental information that accompanies financial statements audited in accordance with PCAOB standards also will be considered. If approved, the new standards for auditors of brokers and
Internal auditors get modest raises in U.S., Canada
U.S. organizations gave internal auditors slightly more generous base-salary increases in the past 12 months, but the magnitude of raises fell slightly in Canada, according to a new survey report. The percentage of U.S. organizations that gave internal auditors base salary increases of 4% or more grew to 16% from
PCAOB’s reporting model proposal poses risks, rewards for audit firms
If public company auditors are required to communicate more information in their reports, there will be more material to second-guess them on if the company they are auditing takes a fall. That is a concern about a new PCAOB proposal that calls for enhanced communication from auditors—in addition to the
U.S., U.K. audit regulators to continue cross-border cooperation
Audit regulators in the United States and the U.K. agreed to continue cooperating on cross-border supervision of audit firms, the U.K. Financial Reporting Council (FRC) announced Thursday. The agreement between the FRC and the PCAOB does not contain an expiration date, but follows recent European Commission decisions that allow such
PCAOB calls for more care in audits of brokers and dealers
The PCAOB is urging auditors of broker-dealers to conduct audits with due professional care and skepticism after PCAOB inspectors identified deficiencies in 57 of the 60 audits of broker-dealers reviewed during the final 10 months of 2012. A report on the PCAOB’s interim inspection program for broker-dealer audits, which was
PCAOB proposes sweeping changes to the auditor’s reporting model
The PCAOB on Tuesday proposed sweeping changes to the auditor’s reporting model for U.S. public companies that would include a requirement for auditors to identify and describe “critical audit matters.” In addition, new standards and related amendments proposed by the PCAOB would require: A statement of auditor independence. This would
CAQ provides guidance to audit firms for reporting on policies and practices
Six possible elements of audit quality are highlighted in a report released Tuesday by the Center for Audit Quality (CAQ). The report describes elements of audit quality that audit firms could consider in refining or developing their own reporting regarding their public company audit practices. The elements are: Firm leadership
PCAOB to consider proposing new auditor’s reporting model
The PCAOB will meet Tuesday to consider proposing a new auditor’s reporting model as well as new auditor’s responsibilities for other information in an annual report that contains audited financial statements and the auditor’s report. The contents of the auditor’s report have been the subject of significant activity by standard
SEC strengthens broker-dealer audit requirements
The SEC on Wednesday approved rule amendments that strengthen audit requirements for broker-dealers. The amendments are intended to increase protections for investors whose money and securities are turned over to SEC-registered broker-dealers. The final rules are available on the SEC’s website. Under previous rules, broker-dealers are required to file annual
What’s your fraud IQ?
The word skepticism is derived from the Greek word skeptesthai, meaning “to reflect, look, or view.” It has evolved over the past 2,300 years to represent, among other definitions, the application of reason and critical analysis in the search for a factually supported conclusion. In this context, the concept of
Public, private companies report rise in audit fees in FY 2012
Fees for external audits of financial statements paid by U.S. public and private companies rose in fiscal year 2012 over the previous year, according to a new survey report. Audit fees paid by 87 public companies averaged $4.5 million in FY 2012, according to a Financial Executives International (FEI) report.
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