PCAOB releases staff update and preview of 2020 Inspection Observations

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Oct 31, 2021

In October 2021, the Public Company Accounting Oversight Board (PCAOB) released a new Spotlight publication, “Staff Update and Preview of 2020 Inspection Observations.” In 2020, the PCAOB inspected 153 audit firms, reviewing portions of 617 audits that generally had financial years ended during 2019 and the first half of 2020.

Key observations from their reviews include the following:

  • They continue to identify a number of deficiencies that recur from year to year.
  • For the majority of the annually inspected audit firms, they identified fewer findings in 2020 compared to their 2019 inspections. In their triennially inspected audit firms, some improvements were noted, although deficiencies continue to remain high.
  • They also observed a number of good practices that they believe may be effective in enhancing audit quality.

Auditors may find this information useful as they plan and perform their audits, and audit committees may benefit from the use of this publication as a reference point when engaging with their auditors. They also believe this information may help investors and other stakeholders become more fully informed about the matters they find in their inspections.

Review the report on the PCAOB's website.

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