Welcome to Fall 2009 meeting of the Public Company Accounting Oversight Board’s Standing Advisory Group.
The SAG is one of the key vehicles the Board uses to gain input and insight into how it should be directing its activities in setting public company auditing standards. We always learn a tremendous amount at these meetings – I know that I certainly do. I want to thank all of you for being willing to serve on the SAG and for taking the time to be here today.
I also want to note at the outset that this is Marty Baumann’s first meeting as the Chair of the SAG. Marty became Chief Auditor and Director of Professional Standards in April 2009 – shortly after the last SAG meeting. Marty is, however, certainly not new to the PCAOB or to our standards-setting program. Before becoming Chief Auditor, he served for three years as the Director of our Office of Research and Analysis. He led ORA in identifying and evaluating emerging audit and accounting issues and challenges and played a key role in directing the focus of the Board’s inspections, enforcement and standards-setting programs. The move to heading the standards program was the logical next step.
One of the things that I hope will become clear at this meeting is that we are embarking on a new phase in standards-setting. I would even call it something of a renaissance. We have a very ambitious standards-setting agenda planned for the coming year. Marty is going to review that agenda with you this morning. His presentation will underscore that we are focusing on some of the “nuts and bolts” auditing issues that our inspection program has highlighted as areas where the standards can be improved or modernized.
The issues the SAG will be discussing today and tomorrow -- auditing fair value measurements; audit committee communications; and related party transactions auditing challenges – also illustrate this renewed focus. Our ongoing projects on confirmations and risk assessment fall into the same category. While the program has always been a busy one, the coming months are likely to see more activity – with more potential impact on financial statement auditing – than any similar period in the Board’s existence.
I also want to emphasize how much we value the role that the SAG plays in our standards-setting. I did a back-of the-envelope count last night, and, if my recollection is right, this is the 17th SAG meeting. The inaugural meeting was in June, 2004, and, since that time, the SAG has discussed a wide range of topics. Not all have resulted in standards-setting projects – at least not yet -- and perhaps it is not always clear how the SAG’s deliberations fit into the Board’s program.
With that in mind, Marty has reached out to SAG members and asked for their suggestions and comments on how we can best use this high-powered group. In his remarks, he is going to touch on some of the suggestions and comments he received. We have also prepared a chart showing the current status of the standards-setting topics previously discussed by the SAG during those six and a half years. We are making that available this morning, and I think you will find it of interest. I hope each of you will feel free to let Marty, or me, or any of the Board members, know if you have additional ideas about the role of the SAG.
With that, I want to again thank you all for taking time to be here with us for the next two days. I will now turn the proceedings over to Marty.