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PCAOB Adopts Rules Requiring Disclosure of the Engagement Partner and Other Accounting Firms Participating in an Audit

  • PCAOB (US Public Company Accounting Oversight Board) (dark gray) Image

Dec 15, 2015

On December 15, 2015, the Public Company Accounting Oversight Board (PCAOB) adopted new rules to provide investors with more information about who is participating in public company audits.

The new rules and accompanying amendments to auditing standards require audit firms to disclose the names of each audit engagement partner, as well as the names of other audit firms that participated in each audit.

Under the final rules, auditors will be required to file a new PCAOB Form AP, Auditor Reporting of Certain Audit Participants, for each issuer audit, disclosing:

  • The name of the engagement partner;
  • The names, locations, and extent of participation of other accounting firms that took part in the audit, if their work constituted 5 percent or more of the total audit hours; and
  • The number and aggregate extent of participation of all other accounting firms that took part in the audit whose individual participation was less than 5 percent of the total audit hours.

The standard filing deadline for Form AP will be 35 days after the date the auditor's report is first included in a document filed with the Securities and Exchange Commission. In the case of initial public offerings, the Form AP filing deadline will be 10 days after the auditor's report is first included in a document filed with the SEC.

The new rules are subject to approval by the SEC.

If approved by the SEC, the disclosure requirement for the engagement partner will be effective for auditor's reports issued on or after January 31, 2017, or three months after SEC approval of the final rules, whichever is later. For disclosure of other audit firms participating in the audit, the requirement will be effective for reports issued on or after June 30, 2017.

Review the press release and the new rules and accompanying amendments on the PCOAB's Web Site.

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