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CPAB 2014 All Firm Inspections Report

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Mar 31, 2015

On March 31, 2015, the Canadian Public Accountability Board (CPAB) issued its 2014 All Firm Inspections Report (the Report ) which notes that, overall, results for all firms inspected in 2014 improved over 2013, largely due to the effectiveness of action plans implemented by the Big Four firms beginning in 2012, and later on by the 10 other annually inspected firms.

The five key inspection themes for all firms, as reported by CPAB in November 2014 in respect of the Big Four firms, are

  1. understanding and evaluating internal controls;
  2. auditing complex accounting estimates;
  3. auditing in foreign jurisdictions;
  4. executing professional skepticism; and
  5. applying professional judgment.

The Report also notes the following four themes, which were also identified in the Big Four firms but were more prevalent among the other firms inspected in 2014:

  1. journal entry testing;
  2. accounting for decommissioning obligations;
  3. use of management’s experts; and
  4. materiality.

Although the quality of audits is improving, CPAB believes that there is still more to be done if firms are to deliver consistent, sustainable high quality audits over the long term.

Review the report on the CPAB's Web site.

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