I support adopting the reorganized auditing standards of the PCAOB using a topical structure and a single, integrated numbering system. The reorganization integrates the Board's interim auditing standards, adopted 12 years ago on a transitional basis, and the standards that the Board has issued since then. I'm pleased that the Board is finally taking this step.
Establishing high quality auditing standards and ensuring their effective implementation by public accounting firms around the world through is fundamental to PCAOB's mission of protecting investors and the public interest.
The reorganization of the Board's standards is built on a framework and approach intended to facilitate practitioners' ease of use of the standards, as well as establish the structure and framework for future updates.
It is my hope that this reorganization is the first step in making PCAOB standards more user-friendly and accessible to practitioners and academics, while facilitating comparison with other auditing standards such as those of the International Auditing and Assurance Standards Board (IAASB) and the Auditing Standards Board (ASB) of the American Institute of Certified Public Accountants (AICPA).
To implement this reorganization, the Board is adopting amendments to its auditing standards and rules and is also rescinding certain auditing standards that are no longer necessary under the reorganization. These amendments do not impose new requirements on auditors or change the substance of the requirements for performing and reporting on audits under PCAOB standards.
The reorganized standards use a numbering convention that is different from conventions used by other standard setters, which should help to avoid the potential for confusion between the standards of the Board and those of other standard setters, while also making comparisons among those standards more efficient, as shown in an appendix to the adopting release.
It is important to note that this proposal does not include redrafting the auditing standards or making substantive changes to the requirements of the standards. The changes resulting from the proposed reorganization are not expected to impose new requirements on auditors or substantively change the requirements of PCAOB standards. The Board will continue to review and consider changes to the content of individual standards in separate standard-setting projects.
The reorganized version of the standards should provide a good framework for moving forward with other standard setting projects.
The final reorganized and renumbered standards, if approved by the SEC, will also be published in a functioning online version of PCAOB's auditing standards. A draft online version was exposed by the Board as a demonstration during the course of this project, and will serve as the foundation for this useful tool going forward.
I would like to thank the staff of Office of the Chief Auditor for their excellent work on this project, particularly Keith Wilson, Greg Fletcher, Robert Ravas, and Hunter Jones.