Investors Are Cautious About Auditor Involvement in Report Preparation, CAQ Finds
by BNA Daily Report for Executives (Subscription required for full article)
May 3, 2012
An article in BNA’s Daily Report for Executives covers a new report from the Center for Audit Quality (CAQ) on a workshop on the evolving role of the auditor to meet the information needs of investors. During the CAQ’s March workshop, participants, including investors, said they “wanted no additional involvement by auditors in preparing a company’s financial statements or Management’s Discussion and Analysis (MD&A), but would welcome auditor oversight of a company's earnings releases.”
“Workshop participants, especially the investors, said they feared that involvement by auditors with the financial statements and in preparation of MD&A, including the key performance indicators (KPIs) often described therein, could place barriers between investors and management's description of its goals and performance,” writes BNA.
“However,” the article continues, “for earnings reports, the workshop participants said some auditor involvement overseeing the veracity of the information contained in them would be welcome.” According to the CAQ’s report, “Participants agreed that the earnings release is of keen interest to investors because it is the timeliest of management's communications about a company's performance.”