The Center for Audit Quality recently published a Guide to PCAOB Inspections to provide an overview of the Public Company Accounting Oversight Board’s (PCAOB) inspection program. Among other topics, the guide discusses:
- The PCAOB inspection process, including how the PCAOB selects audits to inspect and how it inspects an audit and an accounting firm’s quality controls
- The content of PCAOB inspection reports, including the following five things to keep in mind when reading these reports:
- Audit quality is strong.
- “Deficiencies” don’t necessarily mean financial statement errors or defects in a firm’s system of quality control.
- Audits inspected do not constitute a representative sample.
- Inspection reports are not comparable from firm to firm.
- The PCAOB recognizes auditors adapted to COVID-19.
- How audit firms approach the remediation of audit deficiencies and quality control criticisms identified in PCAOB inspections
- Questions audit committees could ask about the PCAOB inspection of their audit firm
