Audit committees play a vital role in the capital markets' investor protection framework through their oversight of the audit engagement and the company’s financial reporting process. The Sarbanes-Oxley Act of 2002, as amended, enhanced the scope of the oversight role played by the public company audit committee by, among other things, making audit committees of listed companies “directly responsible for the appointment, compensation, and oversight” of auditors, imposing stricter independence requirements, and promoting increased audit committee expertise in financial reporting matters.
As part of its mission to protect the interests of investors and further the public interest in the preparation of informative, accurate and independent audit reports, the PCAOB is committed to constructive engagement with audit committees in areas of common interest, including auditor independence and audit quality.
Information of Particular Interest to Audit Committees
PCAOB resources in this section may be of particular interest to audit committee members.
Board Public Reports
Information for Audit Committees About the PCAOB Inspection Process (Aug. 1, 2012)
Observations Related to the Implementation of the Auditing Standard on Engagement Quality Review (Dec. 6, 2013)
Report on 2007-2010 Inspections of Domestic Firms that Audit 100 or Fewer Public Companies (Feb. 25, 2013)
Observations from 2010 Inspections of Domestic Annually Inspected Firms Regarding Deficiencies in Audits of Internal Control Over Financial Reporting (Dec. 10, 2012)
The Quality Control Remediation Process
Staff Audit Practice Alert No. 11, Considerations for Audits of Internal Control Over Financial Reporting (Oct. 24, 2013)
Auditing Standard No. 16, Communications with Audit Committees
AS No. 16 was adopted by the Board in August 2012 and approved by the SEC in December 2012. The standard seeks to improve the audit by enhancing the relevance, timeliness, and quality of communications between auditors and audit committees. These enhancements should facilitate audit committees' financial reporting oversight, fostering improved financial reporting to the benefit of investors.
Research and Analysis
Audit Quality Indicators
Speeches and Statements Related to Audit Committees
The speeches and statements below contain expanded discussion of PCAOB actions bearing on the critical role of audit committees and are the views of the Board or staff member providing the speech.
- Chairman James R. Doty, The Role of Audit in Preventing Financial Reporting Failures (June 13, 2014)
- Chairman James R. Doty, Developments in the Relationships Between Audit Committees and Auditors (May 2, 2014)
- Board Member Jay D. Hanson, 32nd Annual Current Financial Reporting Issues Conference, Financial Executives International:PCAOB Update for Those on the Front Lines of Financial Reporting (Nov. 19, 2013)
- Board Member Jeanette M. Franzel, NACD Board Leadership Conference 2013: Achieving High Quality Audits to Promote Integrity and Investor Protection (Oct. 13, 2013)
- Board Member Jay D. Hanson, AICPA National Audit Committee Forum (Sept. 13, 2013)
- Board Member Jay D. Hanson, American Accounting Association 2013 Annual Ohio Region Meeting: Keynote Address (May 10, 2013)
- Board Member Jay D. Hanson, Baruch College 12th Annual Financial Reporting Conference: Keynote Address (May 2, 2013)
- Chairman James R. Doty, ICAS Aileen Beattie Memorial Lecture: The Role of the Audit in the Global Economy (April 18, 2013)
- Chairman James R. Doty, William & Mary Mason School of Business Norfolk Southern Excellence in Financial Reporting Conference: Keynote Address (April 13, 2013)
- Chairman James R. Doty, Rice University Director-to-Director Exchange: Keynote Address (March 27, 2013)
- Chairman James R. Doty, Florida Bar Association 31st Annual Federal Securities Institute: Keynote Address (Feb. 14, 2013)
- Chairman James R. Doty, University of Texas 35th Annual Conference on Securities Regulation and Business Law: Remarks on the Global Audit (Feb. 8, 2013)
- Board Member Jeanette M. Franzel, American Accounting Association Midyear Conference and Doctoral Consortium: Protecting Investors by Seizing the Opportunity to Strengthen Audit Quality (Jan. 18, 2013)
Information About PCAOB programs
In addition to the information above, the links below provide information on other aspects of PCAOB program areas that may be of interest to audit committee members.
Registered Accounting Firms
The links in this section provide information about accounting firms registered with and inspected by the PCAOB.