Symbol

Global Style Sheet

Video

HeroBlock

Enhancing public trust in the capital markets by promoting high-quality financial reporting.

<p>The Center for Audit Quality</p>

NewsTicker

Text

Discover the latest insights, resources, and standards in auditing and accounting at the Center for Audit Quality (CAQ) website. Access valuable guidance, research, and tools to enhance your expertise and stay informed in the ever-evolving auditing landscape. 

Hosted by Julie Bell Lindsay, CEO of the Center for Audit Quality, Capital Markets Pulse dives into the latest key matters related to the capital markets featuring experts from across the corporate reporting world.

Subscribe for the latest episodes on Spotify,...

Hosted by Julie Bell Lindsay, CEO of the Center for Audit Quality, Capital Markets Pulse dives into the latest key matters related to the capital markets featuring experts from across the corporate reporting world.

Subscribe for the latest episodes on <a href="https://open.spotify.com/show/0Eom56jIKUbXXufaJ98yBX">Spotify</a>, <a href="https://podcasts.apple.com/us/podcast/capital-markets-pulse/id1690673211">Apple Podcasts</a>, <a href="https://podcasts.google.com/feed/aHR0cHM6Ly9mZWVkcy5idXp6c3Byb3V0LmNvbS8yMTkyMjg2LnJzcw==">Google Podcasts</a> or <a href="https://music.amazon.com/podcasts/a9d37ab7-2e09-4ce9-93a5-bc0399d25fae">Amazon Music</a>.

<div id="buzzsprout-player-13614034"></div>
<script src=https://www.buzzsprout.com/2192286/13614034-episode-2-a-follow-up-conversation-with-former-sec-chief-accountants-lynn-turner-and-wes-bricker.js?container_id=buzzsprout-player-13614034&player=small type="text/javascript" charset="utf-8"><span data-mce-type="bookmark" style="display: inline-block; width: 0px; overflow: hidden; line-height: 0;" class="mce_SELRES_start">﻿</span></script>

Podcast | Capital Markets Pulse, Episode 2

Auditors

Policymakers

Investors

Audit Quality

Blog Post

Podcast

Audit quality is driven by talent quality, and the accountant shortage is a critical challenge that could have significant impacts on our US capital markets. To better understand the challenges the profession faces in bringing the next generation of talent...

Audit quality is driven by talent quality, and the accountant shortage is a critical challenge that could have significant impacts on our US capital markets. To better understand the challenges the profession faces in bringing the next generation of talent into the accounting pipeline, the Center for Audit Quality researched student drivers and barriers to choosing to pursue a degree in accounting.

The report, <a href="https://www.thecaq.org/increasing-diversity-in-the-accounting-profession-pipeline"><em>Increasing Diversity in the Accounting Profession Pipeline: Challenges and Opportunities, July 2023</em></a><em>,</em> builds upon the CAQ’s <a href="https://www.boldambition.org/ResearchReport">research conducted</a> in partnership with Edge Research from January 2022 and helped us to gain deeper insight into why undergraduate students may choose not to pursue a degree in accounting, and why or why not accounting majors choose to pursue  CPA licensure after graduating.

We identified many key findings:
<ul>
 	<li>The most significant barriers to majoring in accounting are a lack of interest or passion for the topic (which was partially attributed to negative experiences in introductory-level classes), higher starting salaries in other majors, and students being turned off by the monetary costs and time needed to complete the 150 credit hours required for licensure.</li>
 	<li>While the 150-hour requirement is a top barrier across the board, it is even more prounounced for Black and Latino students, resulting in these students opting out of accounting at higher rates.</li>
 	<li>CPA licensure is overwhelmingly the end goal for students who are majoring in accounting. This is largely due to the expectation that achieving licensure will aid career development and ensure higher salaries.</li>
 	<li>While most accounting majors are committed to pursuing the CPA license, more needs to be done to support Black and Latino students. By improving access to structural supports like mentorship and financial assistance we can make a significant impact on these underrepresented communities in the profession.</li>
 	<li>For graduates, employers can do more to improve the work experience as it relates to work/life balance and entry-level compensation. The research indicates that Black graduates experience lower levels of satisfaction with organizational culture.</li>
</ul>
The findings are significant and provide the profession with actionable insights that can help to remove top barriers to entry for top talent. The findings also reinforce actions many states are already taking, including adjusting the 150-hour rule. For example:
<ul>
 	<li><strong>Indiana </strong>joined the majority of states by allowing students to sit for the CPA exam after 120 hours of study.</li>
 	<li><strong>Oklahoma </strong>also passed legislation lowering the hour threshold to 120.</li>
 	<li>The <strong>Minnesota </strong>Society of CPAs proposed new legislation allowing young accountants to achieve CPA status without needing 150 hours of college credit.</li>
</ul>
There continues to be a need for collaboration and creativity to address the shortages and challenges our profession faces. This report is a part of our broader effort to increase diversity within accounting and highlight actions that our stakeholders can take to attract new talent to the profession. The data shows we still have much more work to do in increasing awareness and improving perceptions about accounting as career choice. We are taking these learnings and building them into our multi-year, collaborative, data-driven <a href="https://www.joinaccountingplus.com/">Accounting+</a> campaign. We are making progress but there’s still a long way to go and the Center for Audit Quality is committed to being a leading voice in realizing the opportunities we are presented with.

<a class="button" href="https://www.thecaq.org/pipelineresearch2023">Read more in our latest research report</a>

&nbsp;

<hr />

<strong>Author</strong>: <a href="https://www.thecaq.org/about-us/our-people/liz-barentzen">Liz Barentzen</a>, Vice President of Talent and Operations at the CAQ

Diversifying the Accounting Talent Pipeline: What Does the Research Say?

Academics

The public company auditing profession faces an ever-evolving corporate reporting landscape. Investors and other stakeholders increasingly seek company prepared information outside financial statements, including environmental, social, and governance (ESG) information which has become a top priority for companies.

The demand for...

The public company auditing profession faces an ever-evolving corporate reporting landscape. Investors and other stakeholders increasingly seek company prepared information outside financial statements, including environmental, social, and governance (ESG) information which has become a top priority for companies.

The demand for ESG-related disclosures is driven by large institutional and private equity investors, retail investors, customers, employees, and other stakeholders. As a result, governments and regulators around the world are taking a closer look at reporting requirements to address stakeholders' information needs. With increasing stakeholder demand and growing regulatory developments, like the European Union’s Corporate Sustainability Reporting Directive (CSRD)  and the U.S. Securities and Exchange Commission’s (SEC’s) highly anticipated final climate-related disclosures rule,  it’s clear that ESG reporting is here to stay.

The Center for Audit Quality conducted our <a href="https://www.thecaq.org/sp-500-and-esg-reporting">annual analysis</a> of S&amp;P 500 ESG reports and CDP Climate Change Questionnaires to determine ESG trends among leading companies. Our findings reveal how many companies report ESG information, what reporting standards and frameworks were used, and if they received assurance from a public company auditor in 2021. Keep reading for our key takeaways.
<h3>Increased Assurance from Public Company Auditors</h3>
An encouraging trend in our analysis of 2021 S&amp;P 500 ESG data is that more companies are seeking third-party assurance from public company auditors. In 2021, 60 companies obtained assurance from public company auditors compared to 43 in 2020, a nearly 40% increase. Companies obtaining assurance from other assurance providers also increased, with 268 companies reporting that they engaged other assurance providers compared to 245 in 2020.
<div class="infogram-embed" data-id="66f21092-9e2f-49df-8b5b-53dbd5ebb278" data-type="interactive" data-title="Assurance/Verification Providers"></div>
<script>!function(e,i,n,s){var t="InfogramEmbeds",d=e.getElementsByTagName("script")[0];if(window[t]&&window[t].initialized)window[t].process&&window[t].process();else if(!e.getElementById(n)){var o=e.createElement("script");o.async=1,o.id=n,o.src="https://e.infogram.com/js/dist/embed-loader-min.js",d.parentNode.insertBefore(o,d)}}(document,0,"infogram-async");</script>

When it comes to the scope of information subject to assurance, companies increased the scope of information subject to assurance by public company auditors in 2021 - shifting from mostly seeking assurance over only greenhouse gas (GHG) emissions to mostly obtaining assurance over GHG emissions <em>and</em> 1-3 other ESG metrics (e.g., water, energy, waste metrics). 31 companies who engaged a public company auditor in 2021 obtained assurance over their GHG metrics plus 1-3 additional ESG metrics.

Public company auditors play a critical role in serving the public interest and supporting the flow of reliable information for decision-making. Their unique skill set, experience incorporating experts into engagements, and understanding of business processes enable them to easily adapt to new reporting landscapes and requirements, and there are many <a href="https://www.thecaq.org/why-choose-a-cpa-for-esg">benefits</a> to engaging a CPA for third-party assurance of ESG information.

The public company auditing profession has decades of experience in developing methodologies that enable them to adhere to professional standards. Auditors also comply with rigorous requirements for independence, firm systems of quality control, and subject matter competency. Auditor assurance over ESG metrics can enhance stakeholder trust and confidence in management’s assertions, data, and disclosures.
<h3>Rising GHG Scope 3 Emissions Reporting</h3>
We also analyzed the GHG scope 3 emissions categories reported in 2021. Overall, companies increased the extent to which they reported each category.

The most reported category in 2020 and 2021 was business travel, with 327 companies reporting this data compared to 258 in 2020. Fuel and energy-related activities was the second most reported category, followed by purchased goods and services. Purchased goods and services saw the largest increase from 2020, with 71 additional companies reporting this category in 2021.
<div class="infogram-embed" data-id="a52f71b5-11ff-407f-a617-310db2cbaccb" data-type="interactive" data-title="Table_Reporting"></div>
<script>!function(e,i,n,s){var t="InfogramEmbeds",d=e.getElementsByTagName("script")[0];if(window[t]&&window[t].initialized)window[t].process&&window[t].process();else if(!e.getElementById(n)){var o=e.createElement("script");o.async=1,o.id=n,o.src="https://e.infogram.com/js/dist/embed-loader-min.js",d.parentNode.insertBefore(o,d)}}(document,0,"infogram-async");</script>

Overall, companies also increased the extent to which they assured each of the GHG scope 3 emissions categories. Business travel, fuel and energy-related activities, and employee commuting were the most assured categories in both 2020 and 2021. Investments had the highest percentage increase at 157%, with 18 companies receiving assurance in 2021 compared to 7 in 2020.
<h3>Standards and Frameworks</h3>
There are four commonly used ESG reporting standards and frameworks – <a href="https://www.sasb.org/standards/download/?lang=en-us">Sustainability Accounting Standards Board (SASB) Standards</a>, , <a href="https://www.fsb-tcfd.org/recommendations/">Task Force on Climate-Related Financial Disclosures (TCFD) Recommendations</a>, <a href="https://www.globalreporting.org/standards/">Global Reporting Initiative (GRI) Standards</a> and the <a href="https://www.integratedreporting.org/resource/international-ir-framework/">Integrated Reporting Framework</a>.

S&amp;P 500 companies continue to use these standards and frameworks to varying degrees, whether fully adopting the standard or framework or using them as a reference when determining what information to include in their ESG report.

The SASB Standards remain the most frequently cited of the four, with 452 companies utilizing the standards in 2021, up from 410 in 2020. Usage of the TCFD Recommendations, the GRI Standards, and IR Framework also increased in 2021. More than 290 companies referenced three or more standards, a significant increase from last year’s 229.
<div class="infogram-embed" data-id="85825501-ec4c-4a07-b57a-b5fa9c66d417" data-type="interactive" data-title="Reporting Standards and Frameworks"></div>
<script>!function(e,i,n,s){var t="InfogramEmbeds",d=e.getElementsByTagName("script")[0];if(window[t]&&window[t].initialized)window[t].process&&window[t].process();else if(!e.getElementById(n)){var o=e.createElement("script");o.async=1,o.id=n,o.src="https://e.infogram.com/js/dist/embed-loader-min.js",d.parentNode.insertBefore(o,d)}}(document,0,"infogram-async");</script>

Our <a href="https://www.thecaq.org/audit-partner-pulse-survey-spring-2023">Spring 2023 Audit Partner Pulse Survey</a> revealed that 41% of audit partners say the diversity of standards and frameworks for ESG reporting is a top challenge facing companies in their industry sector. The CAQ continues to advocate for policies that would enhance and standardize climate-related disclosures in the US to give companies and investors clarity around ESG information. We expressed support for a globally accepted ESG reporting system that is built from existing standards and frameworks in our <u>comment letters</u> to the <a href="https://thecaqprod.wpengine.com/wp-content/uploads/2022/07/caq_issb_s1-and-s2-comment-letter_7_29_2022.pdf">International Sustainability Standards Board</a> (ISSB) and the <a href="https://www.thecaq.org/news/caq-comments-on-sec-climate-disclosure-rule-proposal-supports-objectives-but-identifies-needed-changes">SEC</a>.

ESG remains a topic of focus for our profession and as we prepare for the SEC’s upcoming climate-related disclosures rule, the CAQ is committed to developing resources that enable public company auditors to best meet investor needs for these disclosures and maintain audit quality. Explore the full S&amp;P 500 ESG analysis <a href="https://www.thecaq.org/sp-500-and-esg-reporting">here</a>.

&nbsp;

<hr />

<strong>Author</strong>: <a href="https://www.thecaq.org/about-us/our-people/desire-carroll">Desiré Carroll</a>, Director, Professional Practice, CAQ

The Rise in S&P 500 ESG Reporting

Company Management

Hosted by Julie Bell Lindsay, CEO of the Center for Audit Quality, Capital Markets Pulse dives into the latest key matters related to the capital markets featuring experts from across the corporate reporting world.

Subscribe for the latest episodes on <a href="https://open.spotify.com/show/0Eom56jIKUbXXufaJ98yBX">Spotify</a>, <a href="https://podcasts.apple.com/us/podcast/capital-markets-pulse/id1690673211">Apple Podcasts</a>, <a href="https://podcasts.google.com/feed/aHR0cHM6Ly9mZWVkcy5idXp6c3Byb3V0LmNvbS8yMTkyMjg2LnJzcw==">Google Podcasts</a> or <a href="https://music.amazon.com/podcasts/a9d37ab7-2e09-4ce9-93a5-bc0399d25fae">Amazon Music</a>.
<div id="buzzsprout-player-12881865"></div>
<script src=https://www.buzzsprout.com/2192286/12881865-episode-1-economic-pessimism-labor-challenges-technology-shifts-feat-janet-malzone-and-amanda-iacone.js?container_id=buzzsprout-player-12881865&player=small type="text/javascript" charset="utf-8"></script>

Podcast | Capital Markets Pulse, Episode 1

Cybersecurity

Emerging Reporting Areas

Our corporate reporting ecosystem is constantly evolving, revealing new trends impacting the audit profession. In 2023, regulatory bodies have introduced new rules and regulations, and investors have vocalized their interest in more transparency in corporate reporting. Through it all, the...

Our corporate reporting ecosystem is constantly evolving, revealing new trends impacting the audit profession. In 2023, regulatory bodies have introduced new rules and regulations, and investors have vocalized their interest in more transparency in corporate reporting. Through it all, the US audit profession remains prepared to adapt and maintain audit quality. It’s what we do best.

The Center for Audit Quality (CAQ) is committed to helping all members of the public company auditing profession identify and navigate the latest trends. With the first half of the year behind us, what have we learned so far in 2023? Keep reading for key insights about public companies and the profession.
<h2>Economic Issues Impacting Public Companies</h2>
Gaining deep knowledge of the industries they work in gives auditors an understanding of how to oversee and execute high-quality audits. In their public interest role, auditors build investor trust and confidence in the company-reported information that allows our capital markets to flourish.

As part of our <a href="https://www.thecaq.org/audit-partner-pulse-survey-spring-2023">Spring 2023 Audit Partner Pulse Survey</a>, we asked audit partners from some of the country’s leading public company audit firms about the economic risks facing companies and how they are adjusting. Our results revealed that 69% of audit partners see inflation as the largest economic risk to companies in their primary industry sector, followed by cybersecurity (39%). However, our Spring survey reports a slightly better outlook on the next 12 months of the US economy, with only 38% of audit partners pessimistic about the economic outlook compared to 57% in our Fall 2022 survey.
<div class="infogram-embed" data-id="6d2e47cf-605b-4631-b570-1517d602166a" data-type="interactive" data-title="Question 6: Outlook regarding economy over next 12 months"></div>
<script>!function(e,i,n,s){var t="InfogramEmbeds",d=e.getElementsByTagName("script")[0];if(window[t]&&window[t].initialized)window[t].process&&window[t].process();else if(!e.getElementById(n)){var o=e.createElement("script");o.async=1,o.id=n,o.src="https://e.infogram.com/js/dist/embed-loader-min.js",d.parentNode.insertBefore(o,d)}}(document,0,"infogram-async");</script>

As emerging technologies and innovations continue to raise new questions about security, cybersecurity preparedness is another vital challenge for public companies. Nearly seven in ten audit partners (68%) said companies were moderately prepared to identify and address a cyberattack, up from 65% in our Spring 2022 survey.

Labor shortages were the top economic risk for 35% of audit partners and the accounting profession has not been immune, emphasizing the need for the accounting profession to build a strong, diverse talent pipeline. The CAQ’s <a href="https://joinaccountingplus.com/">Accounting+</a> initiative is designed to help provide a solution by showing students of color how they can pursue rewarding careers in accounting.
<h2>Emerging Financial Reporting Landscapes</h2>
Investors and other stakeholders are increasingly focused on other areas of company-reported information, such as climate information or workplace diversity. According to the CAQ’s <a href="https://www.thecaq.org/sp-500-and-esg-reporting">most recent analysis</a> of the S&amp;P 500, nearly all public companies now report some form of climate information, and 47% of audit partners in our Spring 2023 survey reported that companies in their industry sector are enhancing disclosures in this area.
<div class="infogram-embed" data-id="0f0942e4-c6dd-4c08-8bc1-aa1e8d55ff7a" data-type="interactive" data-title="Question 10: Voluntary corporate disclosures that are increasing/being enhanced"></div>
<script>!function(e,i,n,s){var t="InfogramEmbeds",d=e.getElementsByTagName("script")[0];if(window[t]&&window[t].initialized)window[t].process&&window[t].process();else if(!e.getElementById(n)){var o=e.createElement("script");o.async=1,o.id=n,o.src="https://e.infogram.com/js/dist/embed-loader-min.js",d.parentNode.insertBefore(o,d)}}(document,0,"infogram-async");</script>

The US Securities and Exchange Commission (SEC) also plans to introduce its first climate-related rule for public companies. The CAQ submitted a <a href="https://www.thecaq.org/news/caq-comments-on-sec-climate-disclosure-rule-proposal-supports-objectives-but-identifies-needed-changes">comment letter</a> to the agency with our support for requiring certain registrants to subject Scope 1 and Scope 2 greenhouse gas (GHG) emissions disclosures to attestation. We also expressed the need for a globally accepted climate reporting system built from existing standards and frameworks to bolster investor confidence in these disclosures. And this month, the International Sustainability Standards Board (ISSB), <a href="https://www.ifrs.org/news-and-events/news/2023/06/issb-issues-ifrs-s1-ifrs-s2/#:~:text=On%2026%20June%202023%20the,disclosures%20in%20capital%20markets%20worldwide.">launched</a> its first two sustainability disclosure standards, a significant milestone on the path to delivering a comprehensive global baseline of sustainability-related financial disclosures that will bring investors consistent, comparable sustainability-related financial information.

Technology such as artificial intelligence (AI) is redefining the future of financial reporting, audit, and risk management. Many firms are already using AI to standardize and streamline audit work to deliver high quality audits and remove many of the rote day-to-day tasks that auditors must complete, and firms are also making <a href="https://www.accountingtoday.com/opinion/ai-and-the-future-of-the-accounting-profession">significant investments</a> in new AI systems.

Companies continue to engage with <a href="https://www.thecaq.org/digital-assets">digital assets</a> to streamline their business processes, but these innovations present new risks. In particular, audit committees may need to supervise how public companies use digital assets and ensure effective risk management is in place. As part of their oversight duties, audit committee members can transfer their skills to this new area of financial reporting and help organizations prevent and mitigate challenges. The CAQ continues to monitor other <a href="https://www.thecaq.org/corporate-reporting-trends">emerging trends</a> and how the audit profession can respond.
<h2>An Effective Financial Reporting Ecosystem</h2>
Each July, we commemorate the anniversary of the Sarbanes-Oxley Act (SOX), landmark legislation that strengthened financial reporting and audit quality. The law, signed on July 30, 2002, established key provisions that remain relevant today.

SOX created the Public Company Accounting Oversight Board (PCAOB), a new regulatory body with the authority to set standards for auditors of public companies, enhance auditor ethics, and more. It also required independent audit committees for all listed companies and gave them the direct responsibility to appoint, compensate, and oversee the external auditor.

The legislation also strengthened auditor independence, one of the cornerstones of audit quality. It is critical that the interests of the external auditor are independent of the company to underpin the credibility of the audit.
<div class="infogram-embed" data-id="989d2443-274c-4f35-8f0b-52dcc8636e66" data-type="interactive" data-title="2023_07_Value of the Audit_ Safegaurds"></div>
<script>!function(e,i,n,s){var t="InfogramEmbeds",d=e.getElementsByTagName("script")[0];if(window[t]&&window[t].initialized)window[t].process&&window[t].process();else if(!e.getElementById(n)){var o=e.createElement("script");o.async=1,o.id=n,o.src="https://e.infogram.com/js/dist/embed-loader-min.js",d.parentNode.insertBefore(o,d)}}(document,0,"infogram-async");</script>

While the audit profession continues to face new and ongoing challenges, their role in providing the capital markets with reliable, trustworthy information through high-quality audits has never been more important. Make sure to <a href="https://www.thecaq.org/">subscribe to the CAQ</a> to stay up-to-date on the breaking developments impacting financial reporting and our capital markets.

&nbsp;

<hr />

<strong>Author</strong>: <a href="https://www.thecaq.org/about-us/our-people/julie-bell-lindsay">Julie Bell Lindsay</a>, CEO, CAQ

Julie Bell Lindsay: Key Financial Reporting Trends in 2023: Mid-Year Update

Join the Center for Audit Quality for a free CPE-eligible webinar focused on emerging issues facing public companies and their auditors. During the webinar, you will hear from leaders in public company auditing and its regulatory bodies, including keynote addresses...

Join the Center for Audit Quality for a free CPE-eligible webinar focused on emerging issues facing public companies and their auditors. During the webinar, you will hear from leaders in public company auditing and its regulatory bodies, including keynote addresses from leaders at the U.S. Securities and Exchange Commission and the Public Company Accounting Oversight Board.

The discussion will provide preparer and public company auditor perspectives on issues impacting auditors in today’s regulatory environment. Join this session to learn about the key themes arising in comment letters on filings from the most recent reporting cycle, and overarching themes in recent PCOAB inspection findings, including areas of concern highlighted by the PCAOB staff and observations and best practices from public company auditors.

&nbsp;

<iframe title="YouTube video player" src="https://www.youtube.com/embed/RGBVRsPwWHg" width="560" height="315" frameborder="0" allowfullscreen="allowfullscreen"></iframe>
<h4></h4>
<h4><strong>Keynote Speakers Announced:</strong></h4>
<img class="alignnone wp-image-13965" src="https://thecaqprod.wpenginepowered.com/wp-content/uploads/2023/06/Headshot_Lindsay-McCord.jpg.png" alt="Lindsay McCord" width="100" height="100" />
<strong>Lindsay McCord</strong>
Chief Accountant, Division of Corporate Finance
U.S. Securities and Exchange Commission

<img class="wp-image-13964 alignnone" src="https://thecaqprod.wpenginepowered.com/wp-content/uploads/2023/06/Headshot_George-Botic.jpg.png" alt="George Botic" width="100" height="100" />
<strong>George Botic</strong>
Director of Registration and Inspections
Public Company Accounting Oversight Board
<h4><strong>Panelists:</strong></h4>
<ul>
 	<li>Rohit Elhance, Grant Thornton</li>
 	<li>Liz Gantnier, Forvis</li>
 	<li>Mary T. Hoeltzel, CIGNA</li>
 	<li>Dennis McGowan, Center for Audit Quality</li>
 	<li>Annette Schumacher, Center for Audit Quality</li>
 	<li>Mark Shannon, Crowe</li>
</ul>
<em><strong>Note</strong>: CPE available only to participants who joined the live webcast on July 19, 2023.</em>

Audit Insider Webinar

Event

Earn 1 CPE Credit

In partnership with ISSB, join us for a live broadcast from the New York Stock Exchange close to the expected launch of the IFRS Sustainability Disclosure Standards as part of a series of events taking place around...

<b>Earn 1 CPE Credit</b>

<span data-darkreader-inline-bgcolor="" data-darkreader-inline-bgimage="">In partnership with ISSB, join us for a live broadcast from the New York Stock Exchange close to the expected launch of the IFRS Sustainability Disclosure Standards as part of a series of events taking place around the world. We'll be joining the International Sustainability Standards Board (ISSB) and other panelists to discuss the significance of the new standards, S1 and S2, in creating a global baseline of high-quality sustainability information for investors, and to corporate reporting and assurance in North America and around the world.</span>

<b><span data-darkreader-inline-bgcolor="" data-darkreader-inline-bgimage="">Speakers include:</span></b>
<ul>
 	<li><span data-darkreader-inline-bgcolor="" data-darkreader-inline-bgimage="">Emmanuel Faber, Chair International Sustainability Standards Board</span></li>
 	<li><span data-darkreader-inline-bgcolor="" data-darkreader-inline-bgimage="">Barry Melancon, CPA, CGMA, CEO at Association of International Certified Professional Accountants; President &amp; CEO at American Institute of CPAs</span></li>
 	<li><span data-darkreader-inline-bgcolor="" data-darkreader-inline-bgimage="">Julie Bell Lindsay, CEO of the Center for Audit Quality</span></li>
 	<li><span data-darkreader-inline-bgcolor="" data-darkreader-inline-bgimage="">Pamela Steer, President &amp; CEO of CPA Canada</span></li>
 	<li><span data-darkreader-inline-bgcolor="" data-darkreader-inline-bgimage="">Elizabeth King, President, Sustainable Finance &amp; Chief Regulatory Officer at Intercontinental Exchange</span></li>
 	<li><span data-darkreader-inline-bgcolor="" data-darkreader-inline-bgimage="">Additional speakers to be announced.</span></li>
</ul>
<span data-darkreader-inline-bgcolor="" data-darkreader-inline-bgimage="">This virtual event is designed for accounting, finance, and audit/assurance professionals as well as investor relations professionals and sustainability professionals in the U.S. and abroad.</span>

ISSB Standards Launch Summit

Audit Committee

Preparers/Issuers

Audit Committee Effectiveness: A Webinar Series
Welcome to Audit Committee Effectiveness: a webinar series brought to you by the Center for Audit Quality and the National Association of Corporate Directors. The series explores key takeaways and insights from leaders in the...

<h4>Audit Committee Effectiveness: A Webinar Series</h4>
<em>Welcome to Audit Committee Effectiveness: a webinar series brought to you by the Center for Audit Quality and the National Association of Corporate Directors. The series explores key takeaways and insights from leaders in the financial reporting ecosystem alongside resources developed to aid audit committees and public company board members. Stay tuned to this page for information about topics, participants, and how to register for upcoming webinars.</em>

<img class="alignnone wp-image-12997" src="https://thecaqprod.wpenginepowered.com/wp-content/uploads/2022/11/CAQ_NACD_400x150.png" alt="CAQ NACD" width="200" height="75" />

<hr />

<h4>Episode 3:</h4>
<h2>The Audit Committee Blueprint</h2>
Public company boards are dealing with more than ever before. In an increasingly unpredictable future, this episode of the Audit Committee Effectiveness series discusses principles from the <a href="https://www.nacdonline.org/insights/publications.cfm?ItemNumber=74901">Audit Committee Blueprint</a>, developed by the NACD in partnership with KPMG’s Board Leadership Center. The Audit Committee Blueprint centers on 10 key principles that boards can use and adapt to ensure they are prepared for the future, with a focus on audit quality, internal audit, and audit committee focus and effectiveness. The webinar will focus on four key topics from the Blueprint report:
<ul>
 	<li>Talent in the organization’s finance function</li>
 	<li>Audit quality</li>
 	<li>Internal audit’s value</li>
 	<li>Compliance and culture</li>
</ul>
<iframe title="YouTube video player" src="https://www.youtube.com/embed/HY5dRtS1oBU" width="560" height="315" frameborder="0" allowfullscreen="allowfullscreen"></iframe>
<h4>Panelists:</h4>
<ul>
 	<li><a href="https://www.linkedin.com/in/lfseidman/">Leslie Seidman</a>, Director, Moody’s and Janus Henderson</li>
 	<li><a href="https://www.theiia.org/globalassets/site/2022_aug_anthony_pugliese_full_bio_2.pdf">Anthony Pugliese</a>, President &amp; CEO, The Institute of Internal Auditors</li>
 	<li><a href="https://www.kpmg.us/bios/a/allen-claudia-h.html">Claudia Allen</a>, Senior Advisor, KPMG Board Leadership Center</li>
</ul>
<h4>Moderator:</h4>
<ul>
 	<li><a href="https://www.thecaq.org/about-us/our-people/vanessa-teitelbaum-cpa">Vanessa Teitelbaum</a>, Senior Director, Professional Practice at the CAQ</li>
</ul>
<div class="eventWrapper mt-2 mb-5 pb-5">
<div class="eventTemplate">
<div class="row containerClamp">
<div class="col">
<div class=" animate__animated animate__fadeInUp ">

<em><strong>Note</strong>: CPE available only to participants who joined the live webcast on August 22, 2023.</em>

</div>
</div>
</div>
</div>
</div>

<hr />

<h5>Watch previous episodes in this series:</h5>
<a href="https://www.thecaq.org/event-audit-committee-effectiveness-episode-1">Episode 1: Audit Committee: The Kitchen Sink of the Board</a>

<a href="https://www.thecaq.org/event-audit-committee-effectiveness-episode-2">Episode 2: 2023 Audit Committee Practices: Priorities and Committee Composition</a>

The Audit Committee Blueprint

The CAQ's Dennis McGowan will be speaking at this year's ACFE Global Fraud Conference on the panel, Fraud Risk in the New Risk Fronter: ESG Reporting and Practices.

Panel Description:

ESG practices and reporting are quickly emerging as a new frontier of...

The CAQ's Dennis McGowan will be speaking at this year's ACFE Global Fraud Conference on the panel, <a href="https://events.acfe.com/session_catalog/#/attendee/6C92606D-E3B9-45EC-A013-59C96EB5D76E/catalog">Fraud Risk in the New Risk Fronter: ESG Reporting and Practices</a>.

Panel Description:

ESG practices and reporting are quickly emerging as a new frontier of risk in business and society. The potential for fraud is rising alongside it. Join us for a discussion among experts in various fields and learn how organizations can design and implement controls to ensure accurate ESG practices and reporting.

You Will Learn How To:
<ul>
 	<li>Explore the emerging risks around ESG practices and reporting, including “greenwashing”</li>
 	<li>Identify the potential for fraud in ESG practices and disclosures</li>
 	<li>Examine ways in which organizations can design effective controls around ESG information to build confidence in disclosures and mitigate fraud risk</li>
</ul>
Speakers: <strong><span class="speakerContainer"><span class="speakerItem"><span tabindex="0" title="View Speaker">Brad </span><span tabindex="0" title="View Speaker">Monterio, </span></span><span class="speakerItem"><span tabindex="0" title="View Speaker">Benito </span><span tabindex="0" title="View Speaker">Ybarra, CFE, </span></span><span class="speakerItem"><span tabindex="0" title="View Speaker">Dennis </span><span tabindex="0" title="View Speaker">McGowan, CPA, </span></span><span class="speakerItem"><span tabindex="0" title="View Speaker">Grant </span><span tabindex="0" title="View Speaker">Ostler</span></span></span></strong>
<div class="session-datetime"><strong>CPE:</strong> 1.5 | <strong>Ethics CPE: </strong>No</div>
<div class="session-datetime"><strong>Session Level:</strong> Overview</div>
<div class="session-datetime"><strong>Field of Study: </strong>Specialized Knowledge</div>
<div class="session-datetime"><strong>Recommended Prerequisite: </strong>None</div>
<div></div>
<div><a href="https://urldefense.proofpoint.com/v2/url?u=https-3A__www.fraudconference.com_-3F-5Fga-3D2.118560844.417916913.1685452717-2D857206003.1666707546-26-5Fgac-3D1.120195578.1684334086.CjwKCAjw9pGjBhB-2DEiwAa5jl3NDE7ytri5y49Prd-5FbJHZO9Th-2DNTVrV5exZ4kWYyV8tvAuAFRVwCsBoCLa0QAvD-5FBwE&amp;d=DwMGaQ&amp;c=euGZstcaTDllvimEN8b7jXrwqOf-v5A_CdpgnVfiiMM&amp;r=4PdDGDrNTfeQvy4B6Rmdpg&amp;m=VLLdb4L-GvMvHc4zrWRqBmGeXpT-KQiORRzR5SuXAwY&amp;s=SupLr1GDivGHjeLom0gi4NFXestu--UaFjYX1MUnv9g&amp;e=">Register for the conference.</a></div>

ACFE Global Fraud Conference - Fraud in the New Risk Frontier: ESG Reporting and Practices

Anti-Fraud

<h4>Audit Committee Effectiveness: A Webinar Series</h4>
<em>Welcome to Audit Committee Effectiveness: a webinar series brought to you by the Center for Audit Quality and the National Association of Corporate Directors. The series explores key takeaways and insights from leaders in the financial reporting ecosystem alongside resources developed to aid audit committees and public company board members. Stay tuned to this page for information about topics, participants, and how to register for upcoming webinars.</em>

<img class="alignnone wp-image-12997" src="https://thecaqprod.wpenginepowered.com/wp-content/uploads/2022/11/CAQ_NACD_400x150.png" alt="CAQ NACD" width="200" height="75" />

<hr />

<h3>Episode 2</h3>
<h2>2023 Audit Committee Practices: Priorities and Committee Composition</h2>
Learn more about issues facing audit committees today and how peers may be responding.

The scope of audit committee oversight continues to creep. Given the rapid rate at which risks are emerging and evolving, many boards are taking a fresh look at committee structures and practices to determine whether they are keeping pace with shifting responsibilities and priorities. Our second episode explores insights from the CAQ and Deloitte’s Center for Board Effectiveness’ Audit Committee Practices Report: Priorities and Committee Composition.
<h4><iframe title="YouTube video player" src="https://www.youtube.com/embed/HfsmHZ8e9jw" width="560" height="315" frameborder="0" allowfullscreen="allowfullscreen"></iframe></h4>
<h4>Panelists:</h4>
<ul>
 	<li>Sara Lewis, Audit Committee Chair, Weyerhaeuser</li>
 	<li>Theo Bunting, Audit Committee Chair, Nisource Inc.</li>
 	<li>Krista Parsons, Audit &amp; Assurance managing director with Deloitte’s Center for Board Effectiveness and Audit Committee Program leade</li>
</ul>
<h4>Moderator:</h4>
<ul>
 	<li><a href="https://www.thecaq.org/about-us/our-people/vanessa-teitelbaum-cpa">Vanessa Teitelbaum</a>, Senior Director, Professional Practice at the CAQ</li>
</ul>
<em><strong>Note</strong>: CPE available only to participants who joined the live webcast on March 29.</em>

2023 Audit Committee Practices: Priorities and Committee Composition

August 2, 2023, Washington D.C., - Prat Bhatt, former Chief Accounting Officer at Cisco, has been appointed to the CAQ’s Governing Board, effective August 1, 2023.

The CAQ’s Governing Board is comprised of chief executive officers from eight of the largest...

<strong>August 2, 2023, Washington D.C., - </strong>Prat Bhatt, former Chief Accounting Officer at Cisco, has been appointed to the CAQ’s Governing Board, effective August 1, 2023.

The CAQ’s Governing Board is comprised of chief executive officers from eight of the largest public company auditing firms and the American Institute of CPAs, as well as three independent board members. The Governing Board provides oversight for the CAQ and leads the development of the organization’s strategic agenda.

“Through his expansive experience with finance initiatives at Cisco and his public company board service, Prat has a deep understanding of our capital markets,” said Julie Bell Lindsay, CEO, CAQ. “As the financial reporting landscape in the U.S. continues to evolve, Prat’s expertise will be invaluable to our Governing Board as we continue to fulfill our mission of building and maintaining investor trust in our capital markets.”

“High-quality audits are what drives investor-decision making, and in turn, the smooth operation of our capital markets,” said Bhatt. “I’m pleased to join the CAQ’s Governing Board as they continue to work with the public company audit profession to maintain the highest standards for audit quality.”

<strong>About the Center for Audit Quality
</strong>The Center for Audit Quality (CAQ) is a nonpartisan public policy organization serving as the voice of U.S. public company auditors and matters related to the audits of public companies. The CAQ promotes high-quality performance by U.S. public company auditors; convenes capital market stakeholders to advance the discussion of critical issues affecting audit quality, U.S. public company reporting, and investor trust in the capital markets; and using independent research and analyses, champions policies and standards that bolster and support the effectiveness and responsiveness of U.S. public company auditors and audits to dynamic market conditions.

<strong>Contact
</strong>Brad Jacklin
<a href="mailto:bjacklin@thecaq.org">bjacklin@thecaq.org
</a>202-494-9560

Cisco’s Former Chief Accounting Officer Prat Bhatt Appointed to CAQ’s Governing Board

Press Releases

Despite barriers identified, students are open to accounting and opportunities exist to drive them to pursue the degree 

Washington D.C., July 24, 2023 – Amid a shortage of accountants, undergraduate business students report encountering obstacles to pursuing a degree in...

<em>Despite barriers identified, students are open to accounting and opportunities exist to drive them to pursue the degree </em>

<strong>Washington D.C., July 24, 2023 – </strong>Amid a shortage of accountants, undergraduate business students report encountering obstacles to pursuing a degree in accounting, according to a recent report from the Center for Audit Quality (CAQ).

The report, <a href="https://www.thecaq.org/increasing-diversity-in-the-accounting-profession-pipeline"><em>Increasing Diversity in the Accounting Profession Pipeline: Challenges and Opportunities, July 2023</em></a>, builds upon the CAQ’s <a href="https://www.boldambition.org/ResearchReport">research</a> from January 2022.  Specifically, the CAQ again commissioned Edge Research to gain deeper insight into why undergraduate business students do or do not choose accounting, and why accounting majors and graduates do or do not pursue CPA licensure.

Some of the interesting findings from the research include:
<ul>
 	<li>While openness to accounting exists at the undergraduate business school level, the most significant reasons for not choosing accounting as a major included a lack of interest or passion for the major (driven in part by negative experiences with introductory accounting classes), higher starting salaries in other majors and students not wanting to pursue the 150 academic credit hours required for CPA licensure. The 150 credit hour requirement was more pronounced for Black and Hispanic accounting majors.</li>
 	<li>The CPA license is highly regarded by both accounting majors and graduates. However, a variety of structural supports are correlated with plans to pursue the license, including encouragement of a professor/mentor and whether a student’s college offered a 150 credit hour program (i.e., an accelerated undergraduate program covering 150 credit hours or a 5-year Masters in Accounting program). Black and Hispanic majors and graduates reported less access to such structural supports.</li>
 	<li>The research further shows that for majors and graduates who are planning to pursue CPA licensure and have already met the 150 credit hour requirement, the time required to study for the CPA exam and the difficulty of the exam content were the top obstacles. For those majors and graduates that have not yet completed the 150 hour requirement, the additional cost and time needed to reach it were the biggest obstacles to CPA licensure.</li>
 	<li>For recent accounting graduates, overall work satisfaction shows room for improvement, with higher income earners, those in public accounting firms (including the Big 4) and those with the CPA license most satisfied, and those not pursuing the CPA license and lower income earners least satisfied. Black recent graduates were significantly less satisfied with organizational culture.</li>
</ul>
“In discussion with interested stakeholders, we sought to build on our prior research to better understand why business school students were – or were not – pursuing accounting and the obstacles to CPA licensure,” said Julie Bell Lindsay, Chief Executive Officer, CAQ. “It is important to understand the perspectives of students who were interested in accounting but ultimately did not pursue the career.  We also need to recognize not all potential career accountants are starting from the same place.”

“This report is a part of our broader effort to increase diversity within accounting and highlight for our stakeholders actions that can be taken to attract new talent to the profession,” said Liz Barentzen, Vice President, Operations and Talent Initiatives, CAQ. “The data shows we have much more work to do around awareness and perceptions of an accounting career, and with our multi-year, collaborative, data-driven Accounting+ campaign, I am confident we can address this aspect of the continuing accounting pipeline challenges.”

Download the <a href="https://www.thecaq.org/increasing-diversity-in-the-accounting-profession-pipeline">full report</a> to learn more about these results.

<strong>About the Report</strong>

The CAQ once again partnered with Edge Research to conduct qualitative and quantitative research in two phases. In total, Edge Research heard from more than 1,800 students and recent graduates between October 2022 and May 2023.

In the qualitative phase, Edge Research conducted in-depth interviews (IDIs) with business students and recent accounting graduates. Within the business student groups, nine identified as Black, six as Hispanic, and nine as White/other. Out of these twenty-four students, seven were accounting majors while seventeen were non-accounting business majors. The recent accounting graduate group consisted of fourteen IDIs, of whose participants six identified as Black, six as Hispanic, and nine as White/other.

The quantitative phase consisted of a national survey sample of 1,400 business students at four-year and community colleges and 400 recent accounting graduates employed as accounting professionals.

<strong>About the Center for Audit Quality </strong>

The Center for Audit Quality (CAQ) is a nonpartisan public policy organization serving as the voice of U.S. public company auditors and matters related to the audits of public companies. The CAQ promotes high-quality performance by U.S. public company auditors; convenes capital market stakeholders to advance the discussion of critical issues affecting audit quality, U.S. public company reporting, and investor trust in the capital markets; and using independent research and analyses, champions policies and standards that bolster and support the effectiveness and responsiveness of U.S. public company auditors and audits to dynamic market conditions.

Significant Barriers Deter Students from Pursuing a Degree in Accounting, According to CAQ Report

CAQ in the News

The CAQ applauds the International Sustainability Standards Board (ISSB) for launching its first two sustainability disclosure standards. These standards are a significant milestone on the path to delivering a comprehensive global baseline of sustainability-related financial disclosures that will bring investors...

The CAQ applauds the International Sustainability Standards Board (ISSB) for launching its first two sustainability disclosure standards. These standards are a significant milestone on the path to delivering a comprehensive global baseline of sustainability-related financial disclosures that will bring investors consistent, comparable sustainability-related financial information.

“Investors continue to demand high-quality, accurate, reliable information on climate,” said Julie Bell Lindsay, Chief Executive Officer, Center for Audit Quality. “We are pleased with the ISSB’s newly-launched standards, which will not only help preparers provide sustainability-related financial disclosures to investors but also provide a basis for auditors to deliver credible and reliable assurance over information prepared in accordance with these standards.”

CAQ Statement of Support for ISSB’s S1 and S2 Standards

Statements

 
Audit Partners Pessimistic on U.S. Economic Outlook as U.S. Businesses Continue to Face Inflation, Cybersecurity Risks 
 
&nbsp;
Washington DC, May 19, 2022 – Audit partners are pessimistic about the outlook for the U.S. economy as U.S. businesses continue to face inflation,...

May 2023 Audit Partner Survey

<p><strong> </strong></p>
<p><strong>Audit Partners Pessimistic on U.S. Economic Outlook as U.S. Businesses Continue to Face Inflation, Cybersecurity Risks </strong></p>
<p><strong> </strong></p>
<p>&nbsp;</p>
<p><strong>Washington DC, May 19, 2022</strong> – Audit partners are pessimistic about the outlook for the U.S. economy as U.S. businesses continue to face inflation, cybersecurity risks, and increased regulation, according to the Center for Audit Quality (CAQ’s), <a href="https://centerforauditquality.sharepoint.com/sites/SharedDrive/Shared%20Documents/Stakeholder%20Communications/Campaigns%20and%20Initiatives/Research/Partner%20Survey%20and%20Economic%20Impact/2023%20Surveys/2023%20Spring%20Survey/Communications/thecaq.org/audit-partner-pulse-survey-spring-2023"><em>Audit Partner Pulse Survey</em></a>, a biannual survey of U.S. public company audit partners. The survey provides independent and objective perspectives on a range of topics, including the overall health of the economy and business transformation.</p>
<p>&nbsp;</p>
<p>The survey found that organizations are prioritizing cost management and financial performance over other areas like talent and labor. “We have observed a very significant shift, especially with regards to talent and labor,” said Julie Bell Lindsay, Chief Executive Officer, CAQ. “While organizations were focused on attracting and retaining talent a year ago at the height of ‘The Great Resignation,’ reducing headcount is the top human capital action audit partners are observing within U.S. businesses today.”</p>
<p>&nbsp;</p>
<p>The nature of their work gives audit partners unique insights across a broad spectrum of industries and corporate trends. Below are key findings from their observations.</p>
<p>&nbsp;</p>
<p><strong>Audit partners’</strong><strong> outlook for the economy remains pessimistic</strong></p>
<p>&nbsp;</p>
<ul>
<li>Fewer than 1 in 5 audit partners are optimistic about the economy.</li>
<li>Top audit partner concerns driving this pessimism include inflation (the top concern for the second year in a row), cybersecurity threats, and regulation (a 10-point increase since Spring 2022).</li>
</ul>
<p>&nbsp;</p>
<p><strong>Attracting new talent no longer a focus</strong></p>
<p><strong> </strong></p>
<ul>
<li>Notably, concerns over labor shortages significantly decreased since Spring 2022 (falling by 18 percentage points).</li>
<li>While top human capital actions observed by audit partners a year ago were increasing flexibility in the workplace and increasing compensation, these steeply declined as priority human capital actions by Spring 2023 (a drop in 34 and 38 points, respectively).</li>
<li>Rather, U.S. businesses reported reducing headcount as the top human capital action taken in Spring 2023 (a 37-point increase since Spring 2022). Audit partners in the financial services and technology sectors most frequently observed this human capital action.</li>
<li>Top priorities at U.S. organizations in Spring 2023 were cost management (61%) and financial performance (51%).</li>
</ul>
<p>&nbsp;</p>
<p><strong>Emerging risks and technology shifts </strong></p>
<ul>
<li>Cybersecurity remains a top risk at U.S. organizations according to 39% of audit partners surveyed. The partners observed that organizations remain only moderately prepared for a cyberattack, though 54% of partners did note that communication between boards and public company management on this topic is improving.</li>
<li>Cybersecurity was also reported as a top ESG priority for U.S. businesses, with 55% of partners ranking it as the top short-term priority, and 48% of partners ranking it as the top long-term priority at organizations.</li>
<li>Most U.S. businesses are not exposed to risks associated with China, according to 69% of the audit partners surveyed. Of the partners who did report that organizations in their industry sector had exposure to China, top risks included supply chain disruption (59%), protection of intellectual property (43%) and risks from U.S.-government-imposed restrictions (39%).</li>
<li>Audit partners observed that plans to adopt cryptocurrency as a form of payment fell by 10% across industries since Spring 2022, with steeper drop-offs observed in financial services (18 percentage points), consumer products and retail (14 percentage points), and technology (13 percentage points) industries.</li>
<li>A new survey question revealed that 47% of U.S. businesses are already using artificial intelligence (AI) to some extent. Key uses observed include process automation (63%), customer experience, service and support (44%) and predictive analysis (31%).</li>
</ul>
<p>&nbsp;</p>
<p><strong>The accountant shortage </strong></p>
<ul>
<li>Amid resignations and pipeline challenges, 89% of audit partners reported U.S. businesses were greatly to somewhat affected by the accountant shortage. Audit partners in financial services and technologies, as well as audit partners working with companies valued at less than $1 billion, were more likely to report being organizations in their industry sector as being affected than other audit partners working within different industries and with larger organizations.</li>
</ul>
<p>&nbsp;</p>
<p>Download the report, <a href="https://centerforauditquality.sharepoint.com/sites/SharedDrive/Shared%20Documents/Stakeholder%20Communications/Campaigns%20and%20Initiatives/Research/Partner%20Survey%20and%20Economic%20Impact/2023%20Surveys/2023%20Spring%20Survey/Communications/thecaq.org/audit-partner-pulse-survey-spring-2023"><em>Spring 2023 CAQ Audit Partner Pulse Survey</em></a>, to access the full survey results.</p>
<p>&nbsp;</p>
<p><strong>About the Center for Audit Quality</strong></p>
<p>The Center for Audit Quality (CAQ) is a nonpartisan public policy organization serving as the voice of U.S. public company auditors and matters related to the audits of public companies. The CAQ promotes high-quality performance by U.S. public company auditors; convenes capital market stakeholders to advance the discussion of critical issues affecting audit quality, U.S. public company reporting, and investor trust in the capital markets; and using independent research and analyses, champions policies and standards that bolster and support the effectiveness and responsiveness of U.S. public company auditors and audits to dynamic market conditions.</p>
<p>&nbsp;</p>


<b><strong>Audit Partners Pessimistic on U.S. Economic Outlook as U.S. Businesses Continue to Face Inflation, Cybersecurity Risks</strong></b>

<b>Washington DC, May 19, 2023</b> – Audit partners are pessimistic about the outlook for
the U.S. economy as U.S. businesses continue to face inflation, cybersecurity risks, and
increased regulation, according to the Center for Audit Quality (CAQ’s), <a href="https://www.thecaq.org/audit-partner-pulse-survey-spring-2023">Audit Partner</a>
Pulse Survey, a biannual survey of U.S. public company audit partners. The survey
provides independent and objective perspectives on a range of topics, including the
overall health of the economy and business transformation.

The survey found that organizations are prioritizing cost management and financial
performance over other areas like talent and labor. “We have observed a very
significant shift, especially with regards to talent and labor,” said Julie Bell Lindsay,
Chief Executive Officer, CAQ. “While organizations were focused on attracting and
retaining talent a year ago at the height of ‘The Great Resignation,’ reducing headcount
is the top human capital action audit partners are observing within U.S. businesses
today.”

The nature of their work gives audit partners unique insights across a broad spectrum of
industries and corporate trends. Below are key findings from their observations.

<b>Audit partners’ outlook for the economy remains pessimistic</b>
<ul>
 	<li>Fewer than 1 in 5 audit partners are optimistic about the economy.</li>
 	<li>Top audit partner concerns driving this pessimism include inflation (the top
concern for the second year in a row), cybersecurity threats, and regulation (a
10-point increase since Spring 2022).</li>
</ul>
<b>Attracting new talent no longer a focus</b>
<ul>
 	<li>Notably, concerns over labor shortages significantly decreased since Spring
2022 (falling by 18 percentage points).</li>
 	<li>While top human capital actions observed by audit partners a year ago were
increasing flexibility in the workplace and increasing compensation, these steeply
declined as priority human capital actions by Spring 2023 (a drop in 34 and 38
points, respectively).</li>
 	<li>Rather, U.S. businesses reported reducing headcount as the top human capital
action taken in Spring 2023 (a 37-point increase since Spring 2022). Audit
partners in the financial services and technology sectors most frequently
observed this human capital action.</li>
 	<li>Top priorities at U.S. organizations in Spring 2023 were cost management (61%)
and financial performance (51%).</li>
</ul>
<b>Emerging risks and technology shifts</b>
<ul>
 	<li>Cybersecurity remains a top risk at U.S. organizations according to 39% of audit
partners surveyed. The partners observed that organizations remain only
moderately prepared for a cyberattack, though 54% of partners did note that
communication between boards and public company management on this topic
is improving.</li>
 	<li>Cybersecurity was also reported as a top ESG priority for U.S. businesses, with
55% of partners ranking it as the top short-term priority, and 48% of partners
ranking it as the top long-term priority at organizations.</li>
 	<li>Most U.S. businesses are not exposed to risks associated with China, according
to 69% of the audit partners surveyed. Of the partners who did report that
organizations in their industry sector had exposure to China, top risks included
supply chain disruption (59%), protection of intellectual property (43%) and risks
from U.S.-government-imposed restrictions (39%).</li>
 	<li>Audit partners observed that plans to adopt cryptocurrency as a form of payment
fell by 10% across industries since Spring 2022, with steeper drop-offs observed
in financial services (18 percentage points), consumer products and retail (14
percentage points), and technology (13 percentage points) industries.</li>
 	<li>A new survey question revealed that 47% of U.S. businesses are already using
artificial intelligence (AI) to some extent. Key uses observed include process
automation (63%), customer experience, service and support (44%) and
predictive analysis (31%).</li>
</ul>
<b>The accountant shortage</b>
<ul>
 	<li>Amid resignations and pipeline challenges, 89% of audit partners reported U.S.
businesses were greatly to somewhat affected by the accountant shortage. Audit
partners in financial services and technology, as well as audit partners working
with companies valued at less than $1 billion, were more likely to report
organizations in their industry sector as being affected than other audit partners
working within different industries and with larger organizations.</li>
</ul>
Download the report, <a href="http://thecaqdev.wpengine.com/wp-content/uploads/2023/05/caq_audit-partner-pulse-survey-2023_2023-05.pdf">Spring 2023 CAQ Audit Partner Pulse Survey</a>, to access the full
survey results.

<b>
About the Center for Audit Quality</b>
The Center for Audit Quality (CAQ) is a nonpartisan public policy organization serving
as the voice of U.S. public company auditors and matters related to the audits of public
companies. The CAQ promotes high-quality performance by U.S. public company
auditors; convenes capital market stakeholders to advance the discussion of critical
issues affecting audit quality, U.S. public company reporting, and investor trust in the
capital markets; and using independent research and analyses, champions policies and
standards that bolster and support the effectiveness and responsiveness of U.S. public
company auditors and audits to dynamic market conditions.

Non-GAAP

The Center for Audit Quality and EVERFI Create Limitless Opportunities in the Accounting Field
                          ...

<section class="main-container">

                    
                    <section class="section wrapper">
                        
                        <div class="content-container has-hero ">
                            <div class="content-area">
                                <p class="alignright print"><a href="#"><i class="fa fa-print">
</i></a></p>
                                                                <h3>The Center for Audit Quality and EVERFI Create Limitless Opportunities in the Accounting Field</h3>
                                <h4>Thursday, March 23, 2023</h4>
                                                                <div class="content-block">   
                                    <p><em>CAQ and EVERFI celebrate the launch of digital curriculum designed to attract more diversity into the accounting profession</em></p>
<p><strong>Washington D.C., March 23, 2023</strong> – <a href="https://www.thecaq.org/">The Center for Audit Quality</a> (CAQ), a nonpartisan organization serving as the voice of U.S. public company auditors and <a href="https://everfi.com/">EVERFI</a>, the nation’s leading social impact education innovator, today announced the launch of a first-of-its-kind digital education program, <em><a href="https://accountingcareers.joinaccountingplus.com/">Accounting Careers: Limitless Opportunities</a></em>. The program is designed to help high school students discover how accounting skills can help them achieve their career goals and to attract greater diversity and representation into the accounting profession.</p>
<p>“We’re excited to be able to expose high school students to the accounting profession at a time when they are considering their future and believe this curriculum will help all groups of students see accounting as a viable career path,” says Liz Barentzen, Vice President Talent Initiatives, CAQ. “We know that representation matters, and through this program, we hope to cultivate equitable representation within the accounting field.”</p>
<p>In line with the goals of CAQ’s <a href="https://www.joinaccountingplus.com/">Accounting+</a> program, a nationwide campaign to attract a new generation of diverse students into the talent pipeline, <em>Accounting Careers: Limitless Opportunities </em>exposes students to the wide range of careers available in the accounting and finance space. The interactive course covers the extensive benefits accounting skills can provide in business or in daily life, including contexts like entrepreneurship, investing, and personal finance. The course aligns with Jump$tart National Standards in K-12 Personal Finance Education, ASCA National Standards, and Common Career Technical Core standards.</p>
<p>To celebrate the nationwide launch of the accounting education initiative, the CAQ and EVERFI hosted an interactive event for students and distinguished guests at H.D. Woodson STEM High School in Washington, D.C. This highly engaging event featured retired NFL linebacker and professional athlete, Dahani Jones as MC, and included several talk-show style components to help H.D. Woodson STEM high school students engage with each other and the curriculum. A key component of the event featured accounting professionals who spoke to students about their real-life experiences in their careers. During the event, students participated in activities that saw them exploring what matters to them, what accounting is like, and where a career in accounting can take them.</p>
<p>The event concluded with the presentation of a $5,000 scholarship to one of the participating students.</p>
<p>“Engaging with the students at H.D. Woodson was a valuable experience for our team and true validation of the hard work we are undertaking to ensure that the accounting profession is as diverse as those it serves,” said Barentzen. “We are grateful to District of Columbia Public Schools for seeing the value of this program and the impact it can have on their students and for allowing us to meet and work with them to celebrate the launch of this extraordinary program.”</p>
<p>To learn more about <em>Accounting Careers: Limitless Opportunities</em>, please visit the <a href="https://accountingcareers.joinaccountingplus.com/">website.</a></p>
<p><strong>About the Center for Audit Quality<br>
</strong>The Center for Audit Quality (CAQ) is a nonpartisan public policy organization serving as the voice of U.S. public company auditors and matters related to the audits of public companies. The CAQ promotes high-quality performance by U.S. public company auditors; convenes capital market stakeholders to advance the discussion of critical issues affecting audit quality, U.S. public company reporting, and investor trust in the capital markets; and using independent research and analyses, champions policies and standards that bolster and support the effectiveness and responsiveness of U.S. public company auditors and audits to dynamic market conditions.</p>
<p><strong>About EVERFI, Inc.<br>
</strong>EVERFI from Blackbaud (NASDAQ: BLKB) is an international technology company driving social impact through education to address the most challenging issues affecting society ranging from financial wellness to mental health to workplace conduct and other critical topics. Founded in 2008, EVERFI’s Impact-as-a-Service<sup>TM</sup> solution and digital educational content have reached more than 45 million learners globally. In 2020, the company was recognized as one of the World’s Most Innovative Companies by <em>Fast Company</em> and was featured on <em>Fortune Magazine’s</em> Impact 20 List. The company was also named to the 2021 GSV EdTech 150, a list of the most transformative growth companies in digital learning.<a href="https://www.blackbaud.com/"> Blackbaud</a>, the world’s leading cloud software company powering social good, acquired EVERFI in December of 2021. To learn more about EVERFI, please visit <a href="http://everfi.com/">everfi.com</a> or follow us on <a href="https://www.facebook.com/everfi">Facebook</a>, <a href="https://www.instagram.com/everfi/">Instagram</a>, <a href="https://www.linkedin.com/company/everfi/">LinkedIn</a>, or<a href="https://twitter.com/EVERFI"> Twitter</a> @EVERFI.</p>
                                                                    </div>
                            </div>   
                            
                            <div class="callouts">
                                                                
                                    <ul>
        <li id="fp_widget_related_resources-2" class="widget-odd widget-first widget-1 widget FP_Widget_RelatedResources">        <div class="callout">
            <h4 class="grey">Related Resources</h4>
            <ul class="articles-list">
                                    <li class="publications">
                        <h5>Publications</h5>
                        <p><a href="https://www.thecaq.org/why-choose-a-cpa-for-esg/">Corporate decision-making: Why choose a CPA for your ESG assurance needs?</a><br><span class="date">04.28.23</span></p>
                    </li>
                                        <li class="comment-letter">
                        <h5>Comment Letter</h5>
                        <p><a href="https://www.thecaq.org/iaasb-audit-evidence/">IAASB Audit Evidence Comment Letter</a><br><span class="date">04.21.23</span></p>
                    </li>
                                        <li class="newsletter">
                        <h5>Newsletter</h5>
                        <p><a href="https://www.thecaq.org/public-policy-and-technical-alert-march-2023/">Public Policy and Technical Alert | March 2023</a><br><span class="date">04.12.23</span></p>
                    </li>
                                </ul>
            <p><a href="https://www.thecaq.org/resources/" class="more arrow">See all</a></p>
        </div>
        </li>
<li id="fp_widget_related_news-2" class="widget-even widget-last widget-2 widget FP_Widget_RelatedNews">        <div class="callout">
            <h4 class="grey">Related News</h4>
            <ul class="articles-list">
                                    <li class="">
                        <h5>
</h5>
                        <p><a href="https://www.thecaq.org/news/audit-committee-composition-changing-amid-expanded-scope-and-emerging-risks-according-to-new-report-from-deloitte-and-the-center-for-audit-quality-caq/">Audit Committee Composition Changing Amid Expanded Scope and Emerging Risks, According to New Report from Deloitte and the Center for Audit Quality (CAQ)</a><br><span class="date">01.13.23</span></p>
                    </li>
                                        <li class="">
                        <h5>
</h5>
                        <p><a href="https://www.thecaq.org/news/leading-accounting-organizations-partner-to-diversify-the-accounting-profession/">Leading Accounting Organizations Partner to Diversify the Accounting Profession</a><br><span class="date">01.05.23</span></p>
                    </li>
                                        <li class="">
                        <h5>
</h5>
                        <p><a href="https://www.thecaq.org/news/audit-committee-responsibilities-disclosures-continue-to-expand-according-to-joint-reports/">Audit Committee Responsibilities, Disclosures, Continue to Expand According to Joint Reports</a><br><span class="date">11.30.22</span></p>
                    </li>
                                </ul>
            <p><a href="https://www.thecaq.org/news-events/" class="more arrow">See all</a></p>
        </div>
        </li>
    </ul>
                                    
                            </div>   
                        </div> 
                    
                    </section>



		
				</section>

The Center for Audit Quality and EVERFI Create Limitless Opportunities in the Accounting Field

Earlier this year, the SEC adopted new rules around cybersecurity disclosures. What do audit committees and company management need to know in regards to these new rules and how might they impact reporting and an organization’s cybersecurity program? To help...

Earlier this year, the SEC adopted new rules around cybersecurity disclosures. What do audit committees and company management need to know in regards to these new rules and how might they impact reporting and an organization’s cybersecurity program? To help assist company management and other financial reporting stakeholders, the AICPA and the CAQ are jointly releasing this cybersecurity resource. <a href="https://thecaqprod.wpenginepowered.com/wp-content/uploads/2023/09/caq_management-sec-cybersecurity-disclosure-rules_2023-09.pdf">Download the resource</a> to learn more about:
<ul>
 	<li>Certifications regarding disclosure controls and procedures for cybersecurity disclosures</li>
 	<li>Cybersecurity incident disclosures</li>
 	<li>Disclosing cybersecurity risk management and strategy</li>
 	<li>Cybersecurity governance and board oversight</li>
</ul>

What Management Needs to Know About the New SEC Cybersecurity Disclosure Rules

Publications

As part of the Center for Audit Quality’s (CAQ) ongoing effort to keep members and stakeholders informed on significant public policy and accounting matters, we are pleased to offer the Public Policy and Technical Alert (PPTA). Each month, the PPTA...

<img class="aligncenter wp-image-13848" src="https://thecaqprod.wpenginepowered.com/wp-content/uploads/2023/06/2023_06_PPTA_HEADER.png" alt="Public Policy &amp; Technical Alert" width="600" height="150" />

As part of the Center for Audit Quality’s (CAQ) ongoing effort to keep members and stakeholders informed on significant public policy and accounting matters, we are pleased to offer the Public Policy and Technical Alert (PPTA). Each month, the PPTA highlights and examines the regulatory, standard-setting, legislative, and broader financial reporting developments impacting the public company audit profession. Please note that the PPTA is intended as general information and should not be relied upon as being definitive or all-inclusive. The CAQ encourages member firms to refer to the rules, standards, guidance, and other resources in their entirety at the hyperlinks provided below. All entities should carefully evaluate which requirements apply to their respective organizations.
<h2>In This Issue</h2>
<img class="alignnone wp-image-13854" src="https://thecaqprod.wpenginepowered.com/wp-content/uploads/2023/06/PPTA_Section-Header_SEC.png" alt="SEC" width="400" height="50" />

<strong>SEC Investor Advisory Committee September 21, 2023 Meeting Agenda</strong>
The SEC <a href="https://www.sec.gov/about/advisory-committees/investor-advisory-committee/iac092123-agenda">posted</a> the agenda for its Investor Advisory Committee meeting on September 21, 2023.

<strong>The Importance of a Comprehensive Risk Assessment by Auditors and Management</strong>
The SEC <a href="https://www.sec.gov/news/statement/munter-importance-risk-assessment-082523">posted</a> a statement by Chief Accountant Paul Munter on the importance of a comprehensive risk assessment by auditors and management. This statement discusses management's obligation to take a holistic approach when assessing information about the business and avoid the potential bias toward evaluating problems as isolated incidents, in order to timely identify risks, including entity-level risks; design processes and controls that are responsive to identified risks; and effectively identify information that issuers are required to communicate to investors. Munter also discusses auditors' responsibilities as gatekeepers to hold management accountable in the public interest.

<strong>SEC Division of Corporation Finance Updates CD&amp;Is</strong>
The SEC's Division of Corporation Finance updated the following Compliance and Disclosure Interpretations (CD&amp;Is):

Exchange Act Rules <a href="https://www.sec.gov/divisions/corpfin/guidance/exchangeactrules-interps">Section 120</a>. Manipulative and Deceptive Devices and Contrivances: Rule 10b5-1
<ul>
 	<li>Question 120.29</li>
 	<li>Question 120.30</li>
 	<li>Question 120.31</li>
</ul>
Section 16 and Related Rules and Forms <a href="https://www.sec.gov/divisions/corpfin/guidance/sec16interp">Section 135</a>. Form 4
<ul>
 	<li>Question 135.04</li>
</ul>
Regulation S-K <a href="https://www.sec.gov/divisions/corpfin/guidance/regs-kinterp">Section 133A</a>. Item 408—Insider Trading Arrangements and Policies
<ul>
 	<li>Question 133A.01</li>
 	<li>Question 133A.02</li>
</ul>
Exchange Act Forms <a href="https://www.sec.gov/divisions/corpfin/guidance/exchangeactforms-interps">Section 113</a>. Form F-SR
<ul>
 	<li>Question 113.01</li>
 	<li>Question 113.02</li>
 	<li>Question 113.03</li>
</ul>
Regulation AB and Related Rules <a href="https://www.sec.gov/divisions/corpfin/guidance/regulation-ab-interps.htm">Section 111</a>. Form SF-3
<ul>
 	<li>111.01 Form SF-3 Eligibility Requirements, Timely Transaction Documents</li>
</ul>
<img class="wp-image-13853 alignnone" src="https://thecaqprod.wpenginepowered.com/wp-content/uploads/2023/06/PPTA_Section-Header_PCAOB.png" alt="PCAOB" width="400" height="50" />

<strong>Annual Report on the Interim Inspection Program Related to Audits of Brokers and Dealers</strong>
The PCAOB <a href="https://assets.pcaobus.org/pcaob-dev/docs/default-source/inspections/documents/2022-broker-dealer-annual-report.pdf?sfvrsn=24596f4e_2">published</a> its <em>Annual Report on the Interim Inspection Program Related to Audits of Brokers and Dealers</em>. The report provides:
<ul>
 	<li>Information about PCAOB's 2022 inspections approach;</li>
 	<li>A summary of PCAOB's 2022 inspections observations;</li>
 	<li>A description of “good practices,” which include brief scenarios and possible procedures that may be effective to address those scenarios; and</li>
 	<li>Recommended actions for firms</li>
</ul>
<img class="wp-image-13851 alignnone" src="https://thecaqprod.wpenginepowered.com/wp-content/uploads/2023/06/PPTA_Section-Header_FASB.png" alt="FASB" width="400" height="50" />

<strong>FASB Issues ASU 2023-04Liabilities (Topic 405): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 121</strong>
The FASB <a href="https://fasb.org/Page/Document?pdf=ASU%202023-04.pdf&amp;title=Accounting%20Standards%20Update%202023-04%E2%80%94Liabilities%20(Topic%20405):%20Amendments%20to%20SEC%20Paragraphs%20Pursuant%20to%20SEC%20Staff%20Accounting%20Bulletin%20No.%20121%20(SEC%20Update)">issued</a> ASU 2023-04—Liabilities (Topic 405): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 121.

<strong>FASB Issues 2023 Investor Outreach Report</strong>
The FASB <a href="https://fasb.org/page/getarticle?uid=fasb_Media_Advisory_08-17-23">issued</a> its 2023 Investor Outreach Report. The report notes the expansion of the FASB Investor Advisory Committee with the addition of three new members, and details the FASB's ongoing, proactive investor outreach efforts.

<strong>FASB Issues Standard That Improves Accounting for Joint Venture Formations</strong>
The FASB <a href="https://fasb.org/page/getarticle?uid=fasb_Media_Advisory_08-23-23">issued</a> an ASU intended to provide investors and other allocators of capital with more decision-useful information in a joint venture's separate financial statements, and reduce diversity in practice in this area of financial reporting. The ASU applies to the formation of entities that meet the definition of a joint venture (or a corporate joint venture) as defined in the FASB Accounting Standards Codification Master Glossary. The amendments in this ASU are effective prospectively for all joint ventures with a formation date on or after January 1, 2025, and early adoption is permitted.

<strong>FASB Issues New Chapter of Its Conceptual Framework: Recognition and Derecognition</strong>
The FASB <a href="https://fasb.org/page/getarticle?uid=fasb_Media_Advisory_08-30-23">issued</a> a new chapter of its Conceptual Framework related to the recognition and derecognition of an item in financial statements. The new chapter becomes Chapter 5 of FASB Concepts Statement No. 8, <em>Conceptual Framework for Financial Reporting</em>. It provides three criteria an item should meet to be recognized in financial statements. Those criteria are:
<ul>
 	<li><em>Definitions</em>—The item meets the definition of an element of financial statements.</li>
 	<li><em>Measurability</em>—The item is measurable and has a relevant measurement attribute.</li>
 	<li><em>Faithful Representation</em>—The item can be depicted and measured with faithful representation.</li>
</ul>
The new chapter also sets forth the concept that derecognition should occur when an item no longer meets any one of the recognition criteria.

<img class="wp-image-13852 alignnone" src="https://thecaqprod.wpenginepowered.com/wp-content/uploads/2023/06/PPTA_Section-Header_International.png" alt="International" width="400" height="50" />

<strong>IAASB Launches Public Consultation on Landmark Proposed Global Sustainability Assurance Standard</strong>
The International Auditing and Assurance Standards Board (IAASB) <a href="https://www.iaasb.org/news-events/2023-08/iaasb-launches-public-consultation-landmark-proposed-global-sustainability-assurance-standard">issued</a> its proposed International Standard on Sustainability Assurance (ISSA) 5000, <em>General Requirements for Sustainability Assurance Engagements</em>. With its focus on assurance on sustainability reporting, ISSA 5000, when approved, will be the most comprehensive sustainability assurance standard available to all assurance practitioners across the globe. ISSA 5000 is a principles-based, overarching standard suitable for both limited and reasonable assurance engagements on sustainability information reported across any sustainability topic. The IAASB invites all stakeholders to comment on the proposed revisions via the IAASB website by December 1, 2023.

<strong>What You Need to Know About International Standard on Sustainability Assurance 5000</strong>
The IAASB <a href="https://www.iaasb.org/news-events/2023-08/what-you-need-know-about-international-standard-sustainability-assurance-5000">posted</a> a video on International Standard on Sustainability Assurance (ISSA) 5000, <em>General Requirements for Sustainability Assurance Engagements</em>, What You Need to Know About International Standard on Sustainability Assurance 5000. The IAASB issued the proposed, landmark ISSA 5000 for public consultation on August 2. When approved, ISSA 5000 will be the most comprehensive sustainability assurance standard available to all assurance practitioners across the globe. The IAASB is seeking feedback on the proposed standard from August 2 to December 1.

<strong>FRC Consults on Revisions to Ethical Standard for Auditors</strong>
The Financial Reporting Council <a href="https://www.frc.org.uk/news/august-2023/frc-consults-on-revisions-to-ethical-standard-for">issued</a> a consultation on revisions to the FRC’s Ethical Standard to further enhance and clarify the principles of integrity, objectivity, and independence auditors must abide by. The proposed revisions to the Ethical Standard enhance prohibitions where an audit firm’s independence could be threatened by an economic over reliance on fees from specific entities that are connected. Additional changes reflect significant developments in the International Ethics Standards Board for Accountants Code since the FRC last revised the Ethical Standard in 2019. The new standard has also been revised to ensure breaches of ethical standards are reported to the FRC on a more timely basis. The consultation closes on October 31, 2023.

<strong>FRC Publishes Latest Accountancy and Audit Facts and Trends Report</strong>
The FRC <a href="https://www.frc.org.uk/news/august-2023/frc-publishes-latest-accountancy-and-audit-facts-a">published</a> the 21st edition of its Key Facts and Trends report, providing the latest statistical information and trends on the UK accountancy and audit profession. This year's report highlights continued growth in accountancy membership, with nearly 400,000 members now in the UK and Republic of Ireland, up 2.1% on the previous year. The concentration of audits with the Big Four firms continued to reduce with 33 FTSE 350 audits being undertaken by non-Big Four audit firms, compared with 27 last year.

<strong>IASB Sets Out Accounting Requirements for When a Currency Is Not Exchangeable</strong>
The International Accounting Standards Board (IASB) <a href="https://www.ifrs.org/news-and-events/news/2023/08/iasb-sets-out-accounting-requirements-for-when-currency-not-exchangeable/">issued</a> amendments to IAS 21 <em>The Effects of Changes in Foreign Exchange Rates</em> that will require companies to provide more useful information in their financial statements when a currency cannot be exchanged into another currency. The amendments will help companies and investors by addressing a matter not previously covered in the accounting requirements for the effects of changes in foreign exchange rates. These amendments will require companies to apply a consistent approach in assessing whether a currency can be exchanged into another currency and, when it cannot, in determining the exchange rate to use and the disclosures to provide. The amendments will become effective for annual reporting periods beginning on or after January 1, 2025. The amendments will be consolidated into IAS 21 and IFRS 1 in March 2024.

<img class="wp-image-13850 alignnone" src="https://thecaqprod.wpenginepowered.com/wp-content/uploads/2023/06/PPTA_Section-Header_CAQ.png" alt="CAQ" width="400" height="50" />

<strong>Comment Letter: PCAOB: AS 2405, A Company's Noncompliance With Laws and Regulations (NOCLAR)</strong>
The CAQ <a href="https://www.thecaq.org/comment-letter-pcaob-as-2405">posted</a> a comment letter that provides views to the PCAOB regarding its request for comment on its proposed amendments to PCAOB Auditing Standards related to a Company's Noncompliance with Laws and Regulations and Other Related Amendments. The CAQ is concerned that the proposed amendments would result in requirements that may not be practical or achievable and could cause considerable confusion with respect to the appropriate role of auditors, ultimately to the detriment of investors. The CAQ's key observations on the proposal fall in the following five categories:
<ul>
 	<li>Fundamental shift in the objectives of an audit</li>
 	<li>Scope of the proposal</li>
 	<li>Auditors are not lawyers or forensic specialists</li>
 	<li>Role of auditor versus role of management</li>
 	<li>Costs and benefits of NOCLAR proposal require further study</li>
</ul>
<strong>Comment Letter, Sign-on Letter: PCAOB: AS 2405, A Company's Noncompliance with Laws and Regulations (NOCLAR)</strong>
The CAQ <a href="https://www.thecaq.org/comment-letter-sign-on-letter-pcaob-as-2405">posted</a> a comment letter in which over 170 audit committee chairs, board members, and other capital markets stakeholders signed on to share their concerns about proposed amendments to PCAOB Auditing Standards related to a Company's Noncompliance with Laws and Regulations and Other Related Amendments. These stakeholders support the PCAOB's mission to protect investors by modernizing audit standards that support the performance of continued high-quality audits in today's complex business environment. However, they are concerned that the proposed amendments do not advance that mission. The board members are concerned that the PCAOB's proposal risks reducing audit quality and lessening investor protections while unnecessarily increasing the cost and complexity of audits.

<strong>Comment Letter: IAASB: Proposed International Standard on Auditing 570 (Revised 202X) Going Concern and Proposed Conforming and Consequential Amendments to Other ISAs</strong>
The CAQ <a href="https://www.thecaq.org/comment-letter-iaasb-going-concern">posted</a> a comment letter that provides views to the IAASB related to its request for comment on its Proposed International Standard on Auditing 570 (Revised 202X) Going Concern and Proposed Conforming and Consequential Amendments to Other ISAs. The CAQ is supportive of the Board's objectives to strengthen the auditor's evaluation of management's assessment of going concern and consider ways to enhance transparency with respect to the auditor's responsibilities and work related to going concern. Overarchingly, the CAQ has three primary concerns about the proposal, as follows:
<ul>
 	<li>Need for Improvements to the Applicable Financial Reporting Framework</li>
 	<li>There Are Opportunities to Enhance Scalability</li>
 	<li>KAMs Are a Better Approach to Increase Transparency Through the Auditor's Reporting Requirements</li>
</ul>
<strong>Comment Letter: PCAOB Technology-Assisted Analysis</strong>
The CAQ <a href="https://www.thecaq.org/comment-letter-pcaob-technology-assisted-analysis">posted</a> a comment letter that provides views to the PCAOB related to its request for comment on its Proposed Amendments Related to Aspects of Designing and Performing Audit Procedures that Involve Technology-Assisted Analysis of Information in Electronic Form. The CAQ is supportive of the PCAOB's objective, but encourages the Board to potentially think broader about technology, the audit, and audit quality. The CAQ's most significant comments relate to:
<ul>
 	<li>Clarification provided by defining tests of details</li>
 	<li>Evaluating the reliability of external information maintained by the company in electronic form</li>
 	<li>Investigation of items meeting the criteria established by the auditor when designing and performing substantive procedures</li>
</ul>
<strong>Video: The Current State of ESG Reporting and What to Expect Leading Up to the SEC's Climate Rule, Presented by Desiré</strong> <strong>Caroll</strong>
The CAQ <a href="https://www.thecaq.org/video-sp500-sec-esg">posted</a> a video that gives a rundown of the current state of ESG reporting among S&amp;P 500 companies, pulled from the CAQ's recent analysis. Additionally, given where companies currently are, the implications of the SEC's anticipated climate-related disclosure for public companies is a question. The discussion is presented by Desiré Carroll, Director at the CAQ. Carroll walks through key takeaways from the CAQ's analysis and key information to know leading up to the SEC's climate-related rule.

&nbsp;

<hr />

The Center for Audit Quality is a nonpartisan public policy organization serving as the voice of U.S. public company auditors and matters related to audits of public companies. The CAQ promotes high quality performance by U.S. public company auditors; convenes capital market stakeholders to advance the discussion of critical issues affecting audit quality, U.S. public company reporting, and investor trust in the capital markets; and using independent research and analyses, champions policies and standards that bolster and support the effectiveness and responsiveness of U.S. public company auditors and audits to dynamic market conditions. Based in Washington, DC, the CAQ is affiliated with the American Institute of CPAs. For more information, visit <a href="https://www.thecaq.org/">www.thecaq.org</a>.

The CAQ Public Policy and Technical Alert (PPTA) is intended as general information and should not be relied upon as being definitive or all-inclusive. As with all other CAQ resources, this is not authoritative and readers are urged to refer to relevant rules and standards. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The CAQ makes no representations, warranties, or guarantees about, and assumes no responsibility for, the content or application of the material contained herein and expressly disclaims all liability for any damages arising out of the use of, reference to, or reliance on such material. This publication does not represent an official position of the CAQ, its board, or its members.

<em>Questions and comments about the Public Policy &amp; Technical Alert can be addressed to Vanessa Teitelbaum, Senior Director, Professional Practice (</em><a href="mailto:vteitelbaum@thecaq.org"><em>vteitelbaum@thecaq.org</em></a><em>).</em>

Public Policy and Technical Alert | August 2023

Newsletter

PPTA

The CAQ is pleased to share our views related to the May 2023 International Sustainability Standards Board (ISSB): Consultation on Agenda Priorities. The CAQ is supportive of the ISSB’s efforts to develop and seek comment on its agenda priorities. In...

The CAQ is pleased to share our views related to the May 2023 International Sustainability Standards Board (ISSB): <a href="https://www.ifrs.org/content/dam/ifrs/project/issb-consultation-on-agenda-priorities/issb-rfi-2023-1.pdf">Consultation on Agenda Priorities</a>. The CAQ is supportive of the ISSB’s efforts to develop and seek comment on its agenda priorities. In our letter we highlight the importance of market acceptance and market adoption of the IFRS Sustainability Disclosure Standards. We recognize that deciding on agenda priorities in a complex and evolving sustainability reporting environment presents many opportunities and challenges. We believe that continuing the momentum generated from IFRS S1 and S2 by focusing on interoperability, implementation, new research and standards, connectivity, and outreach with stakeholders including investors and the IASB, will position the ISSB well to make these important decisions.

Read the full comment letter <a href="https://thecaqprod.wpenginepowered.com/wp-content/uploads/2023/09/caq_issb_agenda-consultation-comment-letter_signed_8.31.23.pdf">here</a>.

The Center for Audit Quality

The PCAOB needs to hear from audit committee members on NOCLAR

Trending Resources

Stay Connected.