January 31, 2014

CAQ Snapshot: January 2014

I. Year in Review Showcases CAQ Efforts to Enhance Investor Confidence

The Center for Audit Quality (CAQ) has released its 2013 Year in Review. The annual report, this year titled “Building Confidence in Capital Markets,” documents CAQ key initiatives and accomplishments for calendar 2013.

“Working closely with the profession and key stakeholders, the CAQ responded to challenges while advancing an affirmative agenda devoted to building investor confidence in capital markets through excellence in audit quality,” write CAQ Executive Director Cindy Fornelli and Robert E. Mortiz, Chairman and Senior Partner at PricewaterhouseCoopers LLP and Chairman of the CAQ Governing Board, in an joint introductory letter for the publication.

Among other topics, the Year in Review highlights the CAQ’s work to help public company auditors improve their effectiveness, its support for independent research, its collaborative efforts around fighting financial reporting fraud and working with audit committees, and its engagement with regulators on many key issues, including the auditor’s report, audit quality indicators, and the going concern model.

The 2013 Year in Review also includes new features, such as “The CAQ By the Numbers” and a timeline of key CAQ and policy events for the year.

II. CAQ Executive Director Makes Debut as LinkedIn “Influencer”

The CAQ’s Cindy Fornelli joined a select group of thought leaders participating in LinkedIn’s Influencers program. Her first Influencers commentary, “Chasing Perfection in Corporate Disclosure,” was posted on LinkedIn on January 17.

“While we may never have a perfect disclosure regime, we can and should always strive to perfect what we’ve got,” writes Fornelli in her debut post. “Investors will benefit from our efforts to perfect.”

Launched in October 2012, the Influencers program offers LinkedIn users a chance to hear from and engage with prominent voices from across the economy. On her page, Fornelli will regularly share her perspectives on public company auditing and corporate governance policy issues, as well as viewpoints from her career as a securities lawyer, a working mother, and nonprofit board member.

III. CAQ and AAA Auditing Section Seek Proposals for Access to Audit Personnel Program

In early January, the CAQ and the Auditing Section of the American Accounting Association (AAA) announced a request for proposals for a joint program designed to facilitate accounting and auditing academics’ ability to obtain access to audit firm personnel to participate in their research projects. The CAQ and the AAA Auditing Section established the program in 2013 to generate research on issues that are relevant to audit practice, while providing doctoral students and those professors seeking tenure with access to audit firm personnel to complete the research study protocols.

“The CAQ looks forward to building on the initial success of this joint program with the AAA Auditing Section,” said CAQ Executive Director Cindy Fornelli in a statement. “This program would not be possible without the commitment of our member firms to support research through this program in the hopes of encouraging accounting scholars to focus their interests on topics that are relevant to the public company auditing profession.”

  • CAQ Executive Director and Director of Research Receive AAA Auditing Section Award

In other CAQ/AAA news, at its 2014 Midyear Meeting and Doctoral Consortium, the Auditing Section of the AAA bestowed its Special Award of Merit to Cindy Fornelli and CAQ Director of Research Margot Cella. The Auditing Section’s Executive Committee confers the Special Award of Merit to individuals and institutions who have had a singular impact on the Auditing Section and its members. In the past decade, only one other individual has received a Special Award of Merit.

The CAQ’s Cindy Fornelli and Margot Cella stand with Roger Martin, Past President of the AAA Auditing Section, who presented them with the Auditing Section’s Special Award of Merit.

IV. Reminder: CAQ Request for Academic Research Proposals on Key Auditing Policy Issues

The CAQ’s Access to Audit Personnel announcement in January followed the Center’s early December request for proposals (RFP) to fund independent academic research on auditing-related topics. The December RFP focuses on a number of critical policy issues that are priorities for the CAQ and the public company auditing profession, including Audit Committee Effectiveness, Audit Quality Indicators, Professional Skepticism, and the Value of the Audit.

To be considered, proposals should be received by Monday, March 3, 2014. Grants will be announced on or about May 31, 2014.