United States

Critical audit matters: Audit committee perspectives

FINANCIAL REPORTING INSIGHTS  | 

In June 2017 the Public Company Accounting Oversight Board revised Auditing Standard 3101, The Auditor's Report on an Audit of Financial Statements When the Auditor Expresses an Unqualified Opinion, which requires auditors to communicate critical audit matters (CAMs) in their reports on audits of financial statements. The communication of each CAM in the auditor’s report will include public disclosure of information that heretofore has never been publicly released. This new requirement will have substantial ramifications for auditors and the companies they audit.

The Center for Audit Quality recently issued a video, Critical Audit Matters: Audit Committee Perspectives, in which audit committee chairs share their views on the significance of CAMs, steps they are taking as implementation of the standard nears, and implications for investors and others.

Our white paper, Critical audit matters: Information for audit committees, also is a resource for audit committee members who have questions about CAMs and the process for determining and disclosing them in the auditor’s report.