As the role of the audit committee continues to evolve, it becomes increasingly important for audit committee members to remain up to date and aware of changes to their responsibilities. Deloitte is committed to providing audit committee members with resources and leading practices to help fulfill their responsibilities.

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PCAOB Issues Staff Audit Practice Alert No. 13

On September 22, 2014, the PCAOB issued a Staff Audit Practice Alert to discuss disclosure of uncertainties about a company's ability to continue as a going concern in light of recent changes to US generally accepted accounting principles ("GAAP").

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PCAOB Addresses Role of Audit in Preventing Financial Reporting Failures

At the 3rd Annual Ethics and Compliance Symposium held on June 13, 2014, James R. Doty, President of the Public Company Accounting Oversight Board (PCAOB), delivered a speech that highlighted how the PCAOB has developed various initiatives to enhance audit reliability and quality.

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Key Responsibilities of the Audit Committee Include:

  • Having an effective relationship with management, the internal auditors, and the independent auditor
  • Taking a "risk-intelligent" governance approach
  • Overseeing the establishment of appropriate controls and antifraud programs
  • Overseeing dissemination of earnings press releases, financial information, and earnings guidance
  • Monitoring a robust code of ethics
  • Establishing a process for investigating allegations, especially those against senior management.

Audit Committee Composition Considerations

  • Focus on committee composition, including independence, financial expertise, broad business or leadership perspective, industry knowledge, and succession planning.
  • Consider rotating audit committee members periodically.
  • Engage independent advisers to help evaluate the audit committee’s performance when necessary.

Audit Committee Effectiveness Center

The AICPA presents the guidance and tools to make audit committee best practices actionable.

The AICPA Audit Committee Toolkit: Public Company

Posted with permission. Copyright 2004 by the American Institute of Certified Public Accountants, Inc., New York, New York.