PCAOB Releases Staff Update and Preview of 2020 Inspection Observations

Today the PCAOB released a new Spotlight publication, “Staff Update and Preview of 2020 Inspection Observations(PDF).” 

In 2020, the Public Company Accounting Oversight Board (PCAOB) inspected 153 audit firms, reviewing portions of 617 audits that generally had financial years ended during 2019 and the first half of 2020.

Key observations from our reviews include the following:

• We continue to identify a number of deficiencies that recur from year to year.
• For the majority of the annually inspected audit firms, we identified fewer findings in 2020 compared to our 2019 inspections. In our triennially inspected audit firms, some improvements were noted, although deficiencies continue to remain high.
• We also observed a number of good practices that we believe may be effective in enhancing audit quality.

Auditors may find this information useful as they plan and perform their audits, and audit committees may benefit from the use of this publication as a reference point when engaging with their auditors. We also believe this information may help investors and other stakeholders become more fully informed about the matters we find in our inspections.

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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, including compliance reports filed pursuant to federal securities laws.