PCAOB Urged to Take Audit Standards From AICPA

As members of the new Public Company Accounting Oversight Board (PCAOB) settled into their new offices, one of the first pieces of mail they received was a letter signed by three former chief accountants of the Securities and Exchange Commission (SEC). All three urged the PCAOB to take audit standards away from the American Institute of CPAs (AICPA).

The former SEC officials, Walter Schuetze, Michael Sutton and Lynn Turner, described the AICPA's audit standards as "well-intentioned." But, they wrote, "the inherent conflicts between protecting auditing firms' interests and those of the investing public have resulted in standards tilted to favor the interests of auditors."

Additionally, the former chief accountants asked the oversight board to set auditor independence standards and make sure its quality and control inspections of accounting firms are handled by board staff, not by accounting firms or outside contractors.

The agenda for PCAOB's January 9th meeting includes consideration of adopting a budget, discussion of hiring an interim staff director, and consideration of a proposal for the National Association of Securities Dealers to aid the board in registering accounting firms.

After the basics are in place, the next issues the board will likely address include auditing and independence standards. The Sarbanes-Oxley Act gives the PCAOB the authority to set the standards or to delegate the responsibility. The AICPA currently sets the standards and would like to continue to do so.

View a copy of the full text of the letter to the PCAOB.

You may like these other stories...

Optimism about the US economy continues to grow among CPAs and financial executives, and with that, more companies are expecting to increase hiring in the near future, according to results of a new survey released by the...
Planning has begun to determine the content, design, and structure of the next version of the Uniform CPA Examination – and the American Institute of CPAs (AICPA) is asking the accounting profession for its feedback on...
In a letter sent to Congress last week, the American Institute of CPAs (AICPA), the Virgin Islands Society of CPAs (VISCPA), and the Guam Society of CPAs (GSCPA) sought clarification regarding net investment income tax (NIIT...

Already a member? log in here.

Upcoming CPE Webinars

Sep 24
In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards. A dashboard condenses large amounts of data into a compact space, yet enables the end user to easily drill down into details when warranted.
Sep 30
This webcast will include discussions of important issues in SSARS No. 19 and the current status of proposed changes by the Accounting and Review Services Committee in these statements.
Oct 21
Kristen Rampe will share how to speak and write more effectively by understanding your own and your audience's communication style.
Oct 23
Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.