Volume 4, Issue 1

January 2010

I. CAQ’s Year in Review Highlights 2009 Activities

The Year in Review documents the CAQ’s work to preserve fair value accounting, inform the growing debate over international financial reporting standards, maintain accounting standard-setting independence and elevate the importance of financial statement fraud deterrence and detection.

“These efforts were greatly aided by our partnerships with a variety of stakeholder organizations – including business, investor and academic groups – that helped advance the awareness and discussion of critical issues,” said CAQ Executive Director Cindy Fornelli. “We look forward to continuing to build relationships with key stakeholder groups in 2010.”

II. CAQ Welcomes Grant Thornton LLP’s Stephen Chipman to the Governing Board

The CAQ has welcomed Grant Thornton LLP Chief Executive Officer Stephen Chipman to the organization’s Governing Board. Chipman joined the CAQ Governing Board when he became CEO of Grant Thornton LLP on January 1, 2010. He succeeds former GT CEO Ed Nusbaum, who was named Chief Executive Officer of Grant Thornton International, on the Governing Board.

Chipman has been with Grant Thornton for 28 years, serving in Europe, the United States and Asia. Prior to his ascension to CEO, he spent two years as Chief Executive Officer – Grant Thornton China Management Corporation. In that role, he was responsible for leading the development and growth of services for China, dividing his time between the Shanghai, Beijing and Hong Kong offices.

“We welcome Stephen to the CAQ Governing Board and look forward to adding his international expertise to our work on issues important to investors, public company auditors and the global capital markets,” said Cindy Fornelli in a statement.

III. CAQ Issues Request for Proposals on Auditing Research Projects

The CAQ has issued a request for proposals (RFP) for a second round of funding independent academic research on projects of interest to the auditing profession.

Working through its Research Advisory Board (RAB), the CAQ anticipates funding projects that address the value of the audit, audit quality, professional judgment and professional skepticism. In addition, fraud deterrence and detection and the impact of communication and information technologies on the audit, have been added as potential topics in this second round of funding.

“The CAQ is proud to continue to provide opportunities for academics to advance their research on the profession,” said Cindy Fornelli. “We remain committed to providing opportunities for active engagement between the academic community, one of the CAQ’s key stakeholder groups, and the profession.”

In 2008, the CAQ established the RAB, which is comprised of academics and members of the profession, to promote independent audit and accounting research. In 2009, the RAB funded five independent academic research projects on several topics of interest to the profession. The research and analysis on these projects will continue into the second half of 2010.

IV. Cindy Fornelli Addresses “The State of Investor Confidence”

Cindy Fornelli’s welcome remarks on “The State of Investor Confidence” highlighted the CAQ’s activities during December’s AICPA National Conference on Current SEC and PCAOB Developments. Fornelli’s speech addressed recent regulatory and legislative challenges to audit quality, including recent threats to the Sarbanes-Oxley Act and independence of the accounting standard-setting process. Fornelli also discussed the CAQ’s ongoing efforts in support of audit quality and overarching goal of enhancing investor confidence in the global capital markets.

Fornelli also moderated a panel discussion of Smaller Registrant/Firm Initiatives. Panelists Gerald Laporte, head of the SEC’s Office of Small Business Policy, and Keith Wilson, Associate Chief Auditor of the PCAOB, discussed current issues and initiatives with the potential to impact smaller public companies and smaller audit firms.