The PCAOB today reproposed for comment an auditing standard on Communications with Audit Committees, and other amendments to PCAOB standards. The standard was initially proposed on March 29, 2010.
"Communication with audit committees is a fundamental responsibility of any auditor and has a direct and serious impact on the quality of that audit. This reproposal is intended to further enhance those communications," said James R. Doty, PCAOB Chairman.
Like the original proposal, the reproposed standard would establish requirements that enhance the relevance and quality of the communications between the auditor and the audit committee.
The reproposed standard, in addition, would better align the communication requirements with performance requirements in other PCAOB standards, including the implementation of the risk assessment standards (Auditing Standard Nos. 8-15) that became effective in December 2010. It also would include changes made in response to comments received on the original proposal and other refinements.
Furthermore, on July 21, 2010, Congress gave the Board oversight over the audits of SEC-registered brokers and dealers. Reproposing this standard provides commenters with an opportunity to comment on the standard in relation to the audits of brokers and dealers.
"The auditor communications to the audit committee in the reproposed standard would benefit both the auditor and the audit committee, by providing the auditor with additional information relevant to the audit and assisting the audit committee in fulfilling its oversight responsibilities regarding the financial reporting process," said Chief Auditor and Director of Professional Standards, Martin F. Baumann.
The proposed auditing standard would supersede PCAOB interim standard AU sec. 380, Communication With Audit Committees, and AU sec. 310, Appointment of the Independent Auditor, and amend other PCAOB standards. Any new auditing standard and amendments to other PCAOB standards adopted by the PCAOB will be submitted to the Securities and Exchange Commission for approval.
Comments on the reproposed standard are due Feb. 29, 2012. The Board will carefully consider all comments received before taking final action on the reproposed standard. The proposing release, the reproposed auditing standard, and related amendments to PCAOB standards and comment letters will be available on the website under Rulemaking Docket No. 030. An archive of the webcast and a podcast of the Open Board Meeting also will be available later today on the PCAOB website.