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PCAOB to vote on naming engagement partner
The PCAOB plans to meet next week to vote on a final standard that would create a new form naming the engagement partner on public company audits as well as other firms that participated in the audit.
A new “Form AP” would be created for each public company audit and would be filed with the PCAOB. The form would include the name of the engagement partner and would identify other firms on whose work the primary firm relied during the audit.
“You will be able to see how much of the audit was performed by firms other than the firm issuing the audit opinion,” PCAOB Chairman James Doty told reporters Wednesday following a speech at the AICPA Conference on Current SEC and PCAOB Developments.
A date for the public meeting and vote has not yet been set, but Doty and SEC Chief Accountant James Schnurr said they expect the vote to take place next week.
Available to the public
If approved, Form AP will be filed with the PCAOB “promptly” after the issuance of the audit report and the filing of audited financial statements with the SEC, Doty said. Form AP would not be filed with the SEC but would be available to the public through the PCAOB.
The vote could bring a conclusion to a standard-setting project that began with a concept statement in 2009. The PCAOB originally considered having the engagement partner sign the audit report, and later proposed requiring the engagement partner to be named in the audit report, but not to sign it.
But questions about the relevance of the name of the engagement partner—as well as liability—led to the proposal to create the separate Form AP rather than including the name in the auditor’s report.
“We believe we have come as close as we can to addressing all of the interests here, including the needs of the investor,” Doty said.
Proposal on using other auditors’ work
The PCAOB also is developing a new standard that would address auditors’ procedures for using the work of other auditors. Doty said he expects the board to be in position to propose the standard in early 2016.
“These procedures will be particularly important to improving the quality of large, multinational audits in which significant parts of the audit are conducted by firms other than the signing firm,” Doty said.
—Ken Tysiac (ktysiac@aicpa.org) is a JofA editorial director.
Research & References of PCAOB to vote on naming engagement partner|A&C Accounting And Tax Services
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