In May, the Public Company Accounting Oversight Board (“PCAOB”) posted a preview of its staff’s observations made in relation to audits conducted in 2018. The PCAOB highlighted several common deficiency areas that auditors should focus on improving, including Internal Control over Financial Reporting, Risk Assessment and Revenue, and Accounting Estimates. The PCAOB focused on instances where it believes auditors should use more “professional skepticism,” such as evaluating bias in the data reported by managers and identifying potential material misstatements or fraud.
The PCAOB also outlined “good practices” for improving the quality of audits. Among the tips included are revising training programs, establishing a network of auditors to address emerging risks, and expanding accountability to those in leadership positions.
The text of the preview is available on the PCAOB’s website.