Today, the Center for Audit Quality released their Fall 2023 Audit Partner Pulse Survey, a wide-ranging survey of audit partners at the country’s leading public company accounting firms. The biannual survey, now in its second year, asked audit partners about their perspectives on the current business environment in the United States.
Topics covered include U.S. economic health, challenges and risks facing businesses, and how leaders are adjusting their strategies in the current environment.
“Despite significant domestic political and global concerns, audit partners are significantly less pessimistic on the U.S. economy today compared to a year ago,” said Julie Bell Lindsay, Chief Executive Officer, CAQ. “Despite the improving economic outlook, audit partners see challenges ahead for businesses as inflation remains above historic levels, new regulations affect compliance costs, and cybersecurity threats remain high.”
The survey also gained insight into audit partner perspectives on emerging opportunities and risks, including the accounting talent shortage, cybersecurity, and artificial intelligence (A.I.).
Some of the highlights of the report include:
- Pessimism in the economy has dropped by 30 percentage points since the Fall of 2022.
- Nearly 1 in 3 public companies are using A.I. in their financial reporting. Auditors are also seeing public companies facing challenges in deploying generative A.I. technology in financial reporting, with data quality (47%), lack of mature technology (45%), data security risks (42%), and gaps in talent to implement and manage AI (40%) topping the list of concerns. Business operations (62%) is the primary area where auditors see public companies deploying A.I. technology.
- A clear majority of public companies (59%) are using technology – including A.I. and machine learning – to manage risk, fraud, and cybersecurity threats.
- 3 in 4 audit partners believe regulations are having a negative impact on businesses, primarily because of increased regulatory and legal risks and compliance costs.
- Auditors see nearly two-thirds of companies preparing for new global and U.S. climate reporting requirements. Auditors see nearly half of all companies (45%) voluntarily disclosing environmental and climate information.
- The number of companies seeing cybersecurity as a large economic risk jumped 20 percentage points since the Fall of 2022.
For more information and to read the full report, visit the CAQ website here.
About The Center for Audit Quality
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.
Brad Jacklin (CAQ)