AICPA Releases Proposed SAS on Fraud in Financial Statement Audits

The AICPA has released an exposure draft of a proposed Statement on Auditing Standards (SAS) that would supersede the guidance in AU-C Section 240 with respect to the auditor’s responsibilities related to fraud in a financial statement audit. The AICPA’s goal in publishing the proposal is to “help auditors perform appropriate audit procedures when fraud or suspected fraud is identified in an audit of financial statements and . . . drive auditors to better exercise professional judgment and maintain professional skepticism in planning and performing their audits with respect to identifying, assessing, and responding to risks of material misstatement due to fraud, thereby improving audit quality.”

Comments on the proposed SAS are due by October 3, 2025.