PCAOB Proposes Amendments to Auditing Standards Related to Noncompliance With Laws and Regulations

The PCAOB has issued for public comment a proposal that would “strengthen auditor requirements to identify, evaluate, and communicate noncompliance with laws and regulations.”

The proposal would, among other things, “establish specific requirements for auditors to understand management’s processes regarding compliance with laws and regulations, which can provide insight into the company’s control environment, and to identify, through inquiry and other procedures, laws and regulations applicable to the company with which noncompliance could reasonably have a material effect on the financial statements.”

Comments on the proposal are due by August 7, 2023. For more information, see the press release on the PCAOB’s Web site.