Do you know where the SEC initially stated their position about transitioning to the 2013 Revised COSO framework? It was in September of 2013. Here is the path to that announcement.
One of the topics we discuss in our workshops is the importance of the “CAQ” in the financial reporting process. The CAQ is an important source of information about current positions and developments at the SEC. Surprisingly, we frequently discover that many people are not very familiar with this organization.
So, what is the CAQ? It is, in long form, The Center For Audit Quality.
Their web page is thecaq.org
At their home page you can learn about who they are:
“The Center is an autonomous, nonpartisan, nonprofit group based in Washington, D.C. It is governed by a Board that comprises leaders from the public company auditing firms, the American Institute of CPAs and three members from outside the public company auditing profession. The organization is affiliated with the American Institute of CPAs.”
And what they do:
“The Center for Audit Quality is dedicated to enhancing investor confidence and public trust in the global capital markets by:
- Fostering high quality performance by public company auditors;
- Convening and collaborating with other stakeholders to advance the discussion of critical issues requiring action and intervention;
- Advocating policies and standards that promote public company auditors’ objectivity, effectiveness and responsiveness to dynamic market conditions.”
One really important part of this organization is The CAQ SEC Regulations Committee. This group meets periodically with the SEC staff, generally once each quarter for the first three quarters of the year, and discusses current accounting and disclosure issues. The home page for the committee is:
thecaq.org/resources/caq-committees/sec-regulations
The minutes of these meetings are published on the Committee’s webpage and frequently contain information that, while sometimes fairly narrow, is helpful in the financial reporting process.
For example, it was at a CAQ meeting that the SEC Staff early on stated their position about the transition to the 2013 COSO Framework. Here is a link to those minutes: (Check out page 6)
thecaq.org/docs/reports-and publications/2013septembe25jointmeetinghls.pdf?sfvrsn=0
The most recent highlights of the SEC Regulations Committee meeting with the Staff are at:
This meeting addressed issues ranging from the reporting implications of the FASB’s new consolidation standard, ASU 2015-02, to the application of S-X Rule 3-14 to real estate acquisitions in prior years for a registration statement.
Yes, many of the issues are narrow and technical, but we suggest you check the CAQ minutes each quarter as you get ready to close!
As usual, your comments and thoughts are appreciated!