Volume 25, Issue 22

Executive Summary

The AICPA Conference on Current SEC and PCAOB Developments is a gathering place for key leaders and constituents and serves as a reminder of the important role each party plays in the financial reporting process. Attendees at this year’s conference left Washington, D.C., with a renewed sense of collaboration and partnership. Throughout the event, auditing, accounting, and regulatory organizations reiterated the importance of the participation of all stakeholders, including international standard setters and rule-makers, in the delivery of high-quality financial reporting.

Conference speakers acknowledged the efforts of stakeholders to implement new standards and encouraged them to keep up the momentum on activities associated with standards they have adopted as well as those on the horizon. Topics dominating the conversation at the conference included dry runs for reporting critical audit matters (CAMs); Brexit; implementation of, and continued focus on, the application of the FASB’s new standards on revenue recognition, leases, and credit losses (the “new GAAP standards”); the potential transition away from the London Interbank Offered Rate (LIBOR); and cybersecurity.

In the keynote address, SEC Chairman Jay Clayton and SEC Chief Accountant Wesley Bricker discussed topics such as investor confidence, the new PCAOB board, technology, international matters, hiring and talent issues, non-GAAP measures, and key performance indicators in addition to certain of the topics outlined above. A highlight of the conversation was the unfurling of the “Bricker Blueprint,” a graphic that depicts the role each stakeholder plays in the domestic and international financial reporting process for providing transparent financial information to financial statement users in a timely manner. Mr. Bricker emphasized that stakeholders should strive to work together without silos or blind spots.

The chief accountant issued a statement summarizing the SEC Office of the Chief Accountant's (OCA's) recent key activities, including those related to stakeholder engagement, interactions with other SEC divisions and offices (including an update on independence matters related to the “loan rule”), implementation of new GAAP standards, ICFR, the new PCAOB board, CAMs, role of the auditor, auditor independence, activities of the International Accounting Standards Board (IASB®), audit committees, and innovation.

At a session characterized by Center for Audit Quality (CAQ) Executive Director Cynthia Fornelli as “unprecedented,” audience members were treated to a panel discussion in which all five members of the PCAOB board discussed their perspectives on the PCAOB’s key priorities. While various board members expressed interest in different priorities, PCAOB Board Member Duane DesParte observed in closing that the new members are passionate about all the cited priorities.

These and other topics of discussion are summarized throughout this Heads Up.

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