Chairman Logothetis Delivers Remarks at Forum for Auditors of Small Businesses and Auditors of Broker-Dealers

Remarks as prepared for delivery

Good morning and thank you all for joining us today. I want to begin by acknowledging Kent [Bonham], our Director of the Office of Communications and Engagement (OCE), for the kind introduction, and I also want to thank your team for all the hard work that went into organizing this important forum today.

It is a pleasure to be here with the auditors who play such a critical role in the strength and integrity of our capital markets.

Before I proceed, please know that my remarks reflect my individual views as the PCAOB’s Chairman and do not necessarily reflect the views of the full Board, my fellow Board Members, or the PCAOB’s dedicated staff. 

I grew up in a small village in Greece without electricity or running water, and I attended a one-room schoolhouse until sixth grade. My family relied on assistance from the United States, as did many others in our village, but what we lacked in material wealth, we made up for in values—integrity, hard work, and the understanding that trust, once earned, must never be taken for granted.

Those lessons carried me from my arrival in the United States as a young boy with limited resources but strong determination, through a long career in the audit profession, where I saw firsthand the importance of trust and responsibility to the functioning of the capital markets.

After retiring, I was enjoying time with my family, traveling—and even attempting to learn golf—with mixed results, I might add. I did not expect to return to a full-time career.

But when the opportunity to serve as the PCAOB’s Chairman came up, I was reminded of my responsibility to give back to the country that gave so much to me.

Those experiences bring me here today, guided by the same values that shape the PCAOB’s work: integrity, trust, accountability, and respect for those we serve.

It feels fitting to reflect on those values here today because just a few miles away, Wall Street began with the Buttonwood Agreement—an act of 24 brokers who understood that without trust, the marketplace doesn’t work. The 233rd anniversary of that agreement is on Sunday, and the capital markets that grew from that simple pact more than two centuries ago remain central to the strength of the global economy.

The work that you do—ensuring the integrity of financial reporting—continues the very tradition that started under that Buttonwood tree. And honoring that legacy requires listening to auditors, investors, audit committee members, preparers, academics, and others who keep the financial reporting ecosystem functioning.

That is why my first major initiative as Chairman was to ask stakeholders what the PCAOB’s strategic priorities should be as we begin the PCAOB’s strategic planning process. We will use this input to refresh both our new five-year strategic plan and our standard-setting agenda.

Your perspectives are especially important because as practitioners in smaller firms, you can often feel the impact of our oversight most directly. The comment period is open until this Friday, May 15^th. If you haven’t done so already, I encourage you to share your feedback on the specific questions we posed but also on any broader opportunities or challenges you see in our work.

Additionally, you may have seen that last week, the PCAOB updated its standard-setting, research, and rulemaking projects on our website. The changes outline certain staff activities that are being performed in the interim period until a new standard-setting, research, and rulemaking agenda is issued.

When we publish our strategic goals and priorities—anticipated this summer—we will also release a standard-setting agenda consultation—another first for the PCAOB. This consultation seeks input on more than just priorities for standard-setting projects—it will seek recommendations to improve the overall standard-setting process, including how to effectively collaborate with and engage international standard-setters. 

We want feedback from across the audit and financial reporting ecosystem, so I encourage you to please be candid about what you are seeing and what requires our attention. 

In addition to the PCAOB’s strategic planning process and standard-setting agenda consultation, I want to briefly highlight our near-term priorities and how they relate to your work.

Near-Term Priorities

First, we are evaluating QC 1000 to ensure the standard remains rigorous, principles-based, and harmonized, where appropriate, with the International Standard on Quality Management or ISQM1, while also being practical and effective for firms of all sizes. The Board will soon consider a supplemental request for public comment on certain provisions of QC 1000. We have heard concerns, including from representatives of smaller firms, that some provisions of QC 1000 may not meaningfully contribute to audit quality. We want to make sure we get this right.

Second, we are taking steps to ensure the PCAOB’s inspection program is fit for the next 25 years. Let me be clear: I believe our inspections program has contributed to meaningful improvements in audit quality since the PCAOB was created more than two decades ago. However, I also believe it is time to modernize the program by grounding it in QC 1000 and leveraging emerging technologies like artificial intelligence. 

To help us navigate the complexities of redesigning our inspections program, the PCAOB will soon seek experts from across the financial reporting ecosystem to form an inspections task force. We are looking for experts who have a desire to protect investors and have deep knowledge of QC 1000, inspection regimes, and emerging technologies. Please watch for more information in the coming weeks. I encourage everyone who is interested to apply. 

Staying with our inspection program for another moment, as we better leverage automation and artificial intelligence in the inspection process, we also plan to place greater emphasis on firms’ systems of quality management—with engagement-level reviews serving as validation, rather than the core emphasis. For smaller firms, this shift could lead to clearer, more meaningful inspection reports and a more streamlined process.

Third, we are enhancing our own technological capabilities so we can ensure that oversight keeps pace with the profession. That means becoming more forward-leaning, more technologically adept, and better prepared for the next generation of audit risks. It also means investing in our staff, so they have the tools, training, and resources necessary to meet the demands of a rapidly evolving marketplace.

Finally, we are strengthening guidance and outreach with stakeholders across the audit and financial reporting ecosystem.

In the next few days alone, I will be conducting roundtable discussions with audit committee chairs and investors, as well as meeting with accounting professors and their students. They are the next generation of auditors, and they are entering a profession that is more complex and more consequential than ever before. Their insights help us see what the future demands, so we can be prepared.

Additionally, we are working to create a formal consultation process within our Office of the Chief Auditor (OCA) for auditors to seek clarification on complex or emerging issues. We are committed to ensuring that guidance is timely, consistent, and grounded in real-world practice.

Staying engaged with all of our stakeholders helps ensure that the system continues to serve investors with integrity.

Closing

In closing, I want to end where we began: across the river on Wall Street, where our capital markets first took shape and where trust became the currency that allowed them to grow.

As we prepare to mark 250 years of this great nation this summer, it is worth remembering that progress has always come with partnership between the public and private sectors.

Our work at the PCAOB is part of that legacy and of the future that we are building. This milestone challenges all of us to continue ensuring investors can rely on the information they receive.

Thank you, and I look forward to your questions.