Audit & assurance

Public audit firms must make sure issuers in China and Hong Kong will grant new lead auditors appropriate access to previous engagements, an SEC official warns.

The board’s target team provides insights in four areas of focus to provide guidance for public company auditors and shape the PCAOB’s approach to future inspections.

The Statement of Protocol allows the PCAOB access to inspect Chinese companies the same way it does in other countries. The PCAOB said it plans to put the agreement “to the test” by mid-September.

Deficiency rates decreased in 2021 broker-dealer audits reviewed by the PCAOB, but the board’s report calls for more progress.

New standards target the growing number of public company audits that feature multiple firms, aiming to strengthen the requirements for lead auditors.

The Sarbanes-Oxley Act created the PCAOB in 2002 to oversee public company audits. Twenty years later, the PCAOB — backed by the SEC — is emphasizing inspection and enforcement as ways to strengthen investor protections.

Three-fourths of public company audit partners believe inflation will persist for at least 12 months, according to a Center for Audit Quality survey.

The report highlights 10 areas of focus for inspections and shares five key reminders aimed at helping auditors as they navigate the current economic landscape.