In this second post of our series discussing areas to consider as we navigate our way through the year-end reporting process, we are focusing on the latest news from the PCAOB concerning the inspection process.
As the new PCAOB Board continues to implement their strategic plan (you can read more about the plan here), how they will guide the inspection process has been addressed in an “Inspections Outlook” document issued on December 6, 2018.
The Inspection Outlook begins with a discussion of “transformation” of the inspection process. In this section the Board says:
“We are considering topics such as the procedures we perform on the review of specific engagements and systems of quality control, our approach to selecting engagements for inspection and areas of focus, and how and what we communicate about our inspections. We are also considering how to make our process forward-looking and how to more effectively consider evolving risks, environmental factors, and the changing needs of our stakeholders.”
Areas addressed in the Inspection Outlook include:
System of quality control
Recurring inspection deficiencies
Software audit tools
Audit quality indicators
Changes in the auditor’s report
Implementation of new accounting standards
You can read the details of each area in the Inspection Outlook document.
As always, your thoughts and comments are welcome!