PCAOB Provides Observations From the Target Team’s 2023 Inspections

Today, the PCAOB released a new staff Spotlight, “Observations From the Target Team’s 2023 Inspections.(PDF)”

The target team is a group of inspectors who execute in-depth reviews across audit firms with a focus on emerging audit risks and other topics. This Spotlight provides auditors and other stakeholders with a view into the target team’s observations – including inspection results and good practices – in three focus areas for 2023:

• Significant or unusual events or transactions – The target team worked to gain insights into firms’ methodologies, practices, and execution of audits involving risks posed by significant or unusual events or transactions (e.g., data breaches).
• Crypto assets – As a result of crypto asset market disruptions and the corresponding emerging risks, the target team performed procedures to gather information about certain audits of public companies with material crypto asset activities.
• Multi-location audits – Given geopolitical turmoil (e.g., Russia-Ukraine war) and public companies switching from China-based audit firms to those in the U.S., the target team selected multi-location audits as a focus area in 2023.

Given the events in the banking sector that occurred in 2023, the target team also focused on the interim reviews of certain banks in order to provide real-time perspective on important risks, including low capital ratio, significant share price decline, and unrealized loss. The observations from the target team’s interim reviews can be found in the “Bank Financial Reporting Audits” Spotlight(PDF), published in September 2024.

Visit the PCAOB’s Staff Publications page for more resources on the PCAOB's activities and observations.

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About the PCAOB

The PCAOB is a nonprofit corporation established by Congress to oversee the audits of public companies in order to protect investors and further the public interest in the preparation of informative, accurate, and independent audit reports. The PCAOB also oversees the audits of brokers and dealers registered with the Securities and Exchange Commission, including compliance reports filed pursuant to federal securities laws.