July 31, 2008

Center for Audit Quality Commends CIFiR for its Efforts to Simplify Financial Reporting

Washington, D.C. — The Center for Audit Quality (CAQ) issued the following statement from Executive Director Cindy Fornelli in reaction to the SEC Advisory Committee on Improvements to Financial Reporting’s (CIFiR) vote to approve the recommendations outlined in its Final Report:

"The CAQ commends the SEC’s Advisory Committee on Improvements to Financial Reporting (CIFiR) for developing thoughtful and comprehensive recommendations that will help reduce unnecessary complexity in the financial reporting system and make financial information more useful and understandable for investors. 

Under Bob Pozen as Chair, and through the good work of its many members and subcommittees, CIFiR has developed proposals that not only would increase the utility of information in financial reports filed with the SEC, but also would enhance the accounting standard setting process, improve the substance and design of accounting standards, clarify guidance on financial restatements, and describe factors to be considered in making accounting judgments. 

CAQ member firms were pleased to be represented on, and testify before, CIFiR and its subcommittees, and to provide comments and advice on draft reports. We believe the final results will serve investors well through more transparent financial reports and, as the Public Company Accounting Oversight Board considers the CIFiR recommendations, enhanced public company auditing standards and guidance. 

For its part, the CAQ has been advancing the public dialogue on financial reporting since April 2007 through its 10-city Public Dialogue Tour. Public company auditors have listened as investors, academics, policymakers and corporate executives offered their views on how best to modernize business reporting and enhance audit quality. The CAQ is currently working to summarize the input and prepare a report that will lend further momentum to the effort to improve corporate reporting for the benefit of investors." 

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The Center for Audit Quality (CAQ) is an autonomous public policy organization serving investors, public company auditors and the capital markets. The CAQ’s mission is to foster confidence in the audit process and to aid investors and the markets by advancing constructive suggestions for change rooted in the profession’s core values of integrity, objectivity, honesty and trust. Based in Washington, D.C., the CAQ is affiliated with the American Institute of Certified Public Accountants. For more information, visit www.thecaq.org.