PCAOB Releases Publication on Financial Restatements and Auditor Turnover

The PCAOB has released a new publication, Financial Restatements and Auditor Turnover, as part of its Data Points series. Among other things, the publication notes that the rate of “Big R” restatements (i.e., restatements disclosed in Item 4.02 of an SEC Form 8-K) was approximately 3 percent per year for the period from 2005 to 2024. Further, around 30 percent of such restatements were associated with a prior-year change of auditor, compared with an 11 percent auditor-change rate in the general population (i.e., including entities with no “Big R” restatements).

For more information, see the press release on the PCAOB’s Web site.