Possible revisions to audit committee disclosures
FINANCIAL REPORTING INSIGHTS |
Requirements for the audit committee’s reporting to shareholders primarily are contained in Item 407 of SEC Regulation S-K, and have not changed substantively since 1999. Recently, the SEC published Release No. 33-9862, Possible Revisions to Audit Committee Disclosures, a concept release seeking comment on its audit committee reporting requirements with a focus on the committee’s oversight of independent auditors. The SEC is interested in receiving information about the audit committee and auditor relationship and whether improvements can be made to enhance the information provided to investors about the audit committee’s responsibilities and activities.
The concept release also invites comment on whether SEC disclosure requirements should be refined to provide more insight into the information the audit committee used and the factors it considered in overseeing the independent auditor. This includes considerations related to the process for appointing or retaining the auditor and the qualifications of the auditor and certain members of the engagement team, among others.