Washington (Dec. 9, 2003) -- Representatives of some of the nation’s largest accounting firms are urging the Public Company Accounting Oversight Board to provide clearer, more specific guidance in declaring which specific standards are being changed.
Last April, PCAOB effectively grandfathered in a series of existing standards promulgated by the American Institute of CPA’s Auditing Standards Board governing auditing, attestation, quality control, ethics, and independence of auditors. In November, however, the Board proposed technical amendments designed to make it easier for PCAOB to implement changes in those interim standards. Under the proposed amendments, PCAOB served notice that when the Board adopts any new auditing or related professional practice standard that addresses a subject already covered by the interim standards, “the affected portion of the interim standards will be superseded or effectively amended.
PricewaterhouseCoopers recommended “strongly” that PCAOB establish a process to ensure that changes to existing auditing and related professional practice standards…are clearly identified in standards issued by the Board.” Ernst & Young echoed that suggestion, urging PCAOB to “provide the specific wording of all affected standards that will result from the proposed amendments. We believe it is important for auditors and other interested parties to know the specific wording to minimize the risk that such changes will be misunderstood or not appropriately considered,” E&Y said.
Raising similar concerns, Grant Thornton cited the “critical need to specifically identify the portions of the interim standards that will be superseded (or amended) by newly adopted standards,” while Deloitte & Touche stressed that “providing clear standards and guidance to auditors is essential in order to ensure audits are performed appropriately.”
AICPA president Barry Melancon and chairman Scott Voynich issued a joint statement stressing that clear rules governing auditors is important to the investing public as well as the profession. “As the PCAOB moves forward to supersede or amend transitional standards, we urge PCAOB to identify, as part of the discussion of each proposed standard issued for public comment, how the proposal affects existing interim standards so that such information is clear and accessible both to auditors and to the public,” they said
-- WebCPA staff
