The PCAOB board just voted unanimously to release for a 120-day comment period, a suite of 7 proposed risk assessment standards, and related conforming amendments to other interim standards. PCAOB staff mentioned there will be an appendix outlining each proposed standard, focusing on changes to the existing standards, and another appendix will note major differences from related IAASB International Standards on Auditing (ISAs).
Board member Dan Goelzer asked, “To what extent will these change the way big firms audit and how will that correlate with cost of audit?”
Staff member Keith Wilson replied, “[There is] not any intent to reinvent the wheel,” adding the PCAOB is “trying to take into account improvements that have been made, particularly by the large firms, and to hopefully help create some improvements in that process.”
“I don’t know that we would find that there would be a lot of new requirements or the formulations in standards would generate a significant amount of increased audit effort, but that’s another area we seek comment on, when auditors look at that, do they have a different perspective, what’s the perspective of others as well on value of procedures, perceived effort,” said Wilson.
Goelzer added, “It is important we get those comments, we’ve been at this for 6 years, we find people sometimes have a different view on the impact on auditing and cost of auditing of these proposals than we have.”
PCAOB generally posts same-day press releases confirming the results of their board meetings on http://www.pcaobus.org/, and we will report additional highlights from today’s PCAOB board meeting in a summary on http://www.financialexecutives.org/.
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