United States

COVID-19: Auditor and audit committee considerations


The Center for Audit Quality (CAQ) recently published a COVID-19 resource, Key Auditor and Audit Committee Considerations. In addition to summarizing the PCAOB’s reminders for audits nearing completion, the resource discusses key questions for audit committees to consider, including the following, among others:

  • Has the COVID-19 crisis impacted the financial reporting process and controls?
  • Has the audit or interim review by auditors been affected?
  • How has management communicated:
    • Changes in significant estimates and assumptions and executed related controls?
    • The impact of COVID-19 on financing arrangements, including debt covenants?
  • Have there been changes to the company’s use of non-GAAP financial measures? If so, what is the rationale for such changes and are disclosures compliant with SEC regulations?
  • Have material corporate events occurred triggering a requirement to issue a Form 8-K?
  • Has the company considered whether to apply for assistance under a government relief program? If so, what conditions of that relief might have disclosure or financial reporting consequences?

The CAQ resource also includes considerations related to certain accounts and disclosures that may be impacted by the COVID-19 pandemic, including the following, among others that are discussed further in RSM’s white paper, Coronavirus: Financial reporting considerations:

  • Impairments of long-lived assets, goodwill, investments and inventory
  • Income taxes
  • Debt modifications and loan covenants
  • Exit or disposal activities
  • Insurance recoveries
  • Hedge accounting
  • Ability to continue as a going concern

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