AICPA SEC and PCAOB National Conference Highlights

DOIhttp://doi.org/10.1002/jcaf.22168
Date01 May 2016
Published date01 May 2016
91
© 2016 Wiley Periodicals, Inc.
Published online in Wiley Online Library (wileyonlinelibrary.com).
DOI 10.1002/jcaf.22168
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AICPA SEC and PCAOB National
Conference Highlights
Donald A. Walker Jr.
The American Institute of
Certified Public Accountants
(AICPA) held its annual Securi-
ties and Exchange Commission
(SEC) and Public Company
Accounting Oversight Board
(PCAOB) National Conference
on December 9–11, 2015, in
Metropolitan Washington, DC.
SEC Chair Mary Jo White
was the keynote speaker for
the conference. She spoke on
the responsibilities of prepar-
ers, auditors, audit committees,
standard setters, and regulators
in maintaining high-quality,
reliable financial reporting.
As to preparers, Chair
White stressed the importance
of the design and effectiveness
of internal control over finan-
cial reporting (ICFR), and the
reasonable use of non–generally
accepted accounting principles
(GAAP) reporting measures.
As to auditors, Chair White
emphasized auditors’ role as
gatekeepers. She noted observa-
tions of improvement in audit
quality, but also cautioned
about deficiencies the PCAOB
observed in auditing the effec-
tiveness of ICFR, in assessing
and responding to the risks of
material misstatement, auditing
of accounting estimates, and
work performed by firms other
than the signing firm in cross-
border audits. She specifically
cited two enforcement cases
(the BDO and Grant Thornton
cases) where independent audit
firms missed or ignored red flags.
As to audit committees,
Chair White observed that a
key asset of an audit commit-
tee member was adequate time
available to take on the heavy
and increasing responsibilities
of audit committees. She cau-
tioned that an increasing work-
load might divert a committee
from the core responsibilities of
selecting and overseeing inde-
pendent auditors, setting up an
appropriate system for receiving
and acting on complaints about
financial reporting, and report-
ing to shareholders. She cited
the July 2015 SEC Concept
Release regarding audit com-
mittee reporting and referred
interested parties to Deputy
Chief Accountant Brian Crote au’s
speech on the matter.
As to standard setters,
Chair White underscored the
importance of high-quality
global accounting standards
and the importance of the
work performed by the Finan-
cial Accounting Standards
Board (FASB) and the Interna-
tional Accounting Standards
Board (IASB) in developing a
new converged revenue recog-
nition standard. In addition,
she emphasized the work of
the SEC staff to provide a
framework for including Inter-
national Financial Reporting
Standards (IFRS)-based infor-
mation in SEC filings as a step
toward achieving a single set of
global accounting standards.
The SEC staff is currently dis-
cussing such a framework with
the commissioners prior to
making a recommendation to
the Commission.
As to regulators, Chair
White discussed the impor-
tance of the PCAOB and
the SEC’s shared work with
the PCAOB to ensure audit
quality and thereby high-
quality financial reporting. She
stressed the importance of the
ongoing review of disclosure
effectiveness by the Division
of Corporation Finance. She
also stressed the Enforce-
ment Division’s focus on the
role of accountants and audi-
tors and audit committees as

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