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PCAOB Close on Rule for Naming Engagement Partner

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Dec 10th 2015
Staff Writer and Editor AccountingWEB
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The Public Company Accounting Oversight Board (PCAOB) will vote next week on a new standard that would require the name of the engagement partner on public company audits to be disclosed in a newly created form.

During a speech at an American Institute of CPAs conference of standard-setters in Washington on Dec. 9, PCAOB Chairman James Doty hinted that action on the standard would be coming soon.

“We believe we are very close to bringing that to fruition and should be able, possibly next week, to come forth with a standard,” he said.

The PCAOB announced on Dec. 10 that board members will consider adopting the new rules during an open meeting scheduled for 10 a.m. ET on Dec. 15.

The final rule would require audit firms to disclose the name of the engagement partner on the audit, in addition to information about other independent public accounting firms that participated in the audit, in a new Form AP, rather than in the auditor's report.

The form would be filed with the PCAOB and made public on the audit regulator's website.

Currently, auditor's reports generally disclose only the name of the firm issuing the report. There is seldom information on other firms that participated in the audit or information about the partner who led the work.

“A cornerstone of our effort to provide investors more information about the audit and the auditors who conduct them is our consideration of disclosure to investors of the identity of the engagement partner and other firms that conduct an audit,” Doty said last June. “Knowing the identity of the engagement partner plays a key role in investor confidence and capital formation in those jurisdictions where it is provided to investors. Form AP is a middle-ground approach that would provide investors this disclosure in a manner that responds to auditors' concerns about risk.”

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