August 10, 2026
 

Public Policy and Technical Alert | July 2026

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.

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In This Issue

SEC

Statement on the 2026 Regulatory Agenda

The SEC issued a statement by Chairman Paul S. Atkins on the 2026 Regulatory Agenda. In his statement, Atkins emphasizes the Commission’s renewed focus on investor protection, capital formation, fair and efficient markets, crypto and technological innovation, revitalizing public markets, expanding responsible private-market access, and preserving U.S. financial leadership.

SEC Proposes New E-Delivery Approach to Make Information More Readily Accessible and Useful for Investors

The SEC proposed Regulation E-Delivery, a new rule that would expand the ability of issuers, broker-dealers, investment advisers, and others to use electronic delivery to satisfy information delivery requirements under the federal securities laws. The public comment period will remain open until September 21, 2026.

SEC Updated Questions and Answers for Corporation Finance Interpretations (CFIs)

The SEC updated the CFIs around the following topics:

​​PCAOB

PCAOB Announces Members of the Inspections Modernization Council

The PCAOB announced the members of the Inspections Modernization Council, a new resource group composed of outside parties with a stake in the PCAOB’s inspection activities. This 12-member group will provide perspectives to inform the PCAOB’s efforts to modernize its inspection program and thereby improve audit quality.

PCAOB Approves Request for Comment on Draft Goals and Objectives for 2026-2030 Strategic Plan

The PCAOB held an open meeting on July 20, 2026. At the meeting, the Board approved a request for public comment on draft goals and objectives for the PCAOB’s 2026-2030 strategic plan. A recording of the meeting can be found here. The deadline for comments on the draft goals and objectives is September 4, 2026.

FASB

FASB Seeks Public Comment on Proposal to Improve Investment Company Fair Value Reporting

The FASB published a proposed Accounting Standards Update (ASU) intended to improve investment company financial reporting by amending how investment companies measure the fair value of an equity security that is subject to a contractual sale restriction. Stakeholders were encouraged to review and provide comments on the proposed ASU by July 17, 2026.

Public Markets Advisory Committee Meeting Recap: May 14, 2026

The FASB shared a recap of its Public Markets Advisory Committee meeting that was held on May 14, 2026. The following topics were discussed:

International

July 2026 International Accounting Standards Board (IASB) Agenda and Meeting Papers Now Available

The IFRS Foundation announced that the agenda, papers, and meeting summary of the July 21-22, 2026, IASB meeting are now available. The July IASB Update and podcast also available.

Corporate Reporting Remains Human-Led Amid Growing Adoption of Artificial Intelligence

New Financial Reporting Council (FRC) research suggests the use of artificial intelligence in corporate reporting is increasing, but adoption remains cautious and uneven across the market.

FRC Annual Review of Audit Quality Equips Investors and Audit Committees to Make Better Decisions

The FRC published its Annual Review of Audit Quality 2026. Alongside the report, the FRC has published data on Audit Firm Metrics. The FRC will host a webinar on September 23, 2026, to discuss the Annual Review of Audit Quality and its approach to supervision.

International Auditing and Assurance Standards Board (IAASB) Proposes Targeted Revisions to the ISA for Audits of Less Complex Entities

The IAASB released for public consultation proposed revisions to the International Standard on Auditing for Audits of Financial Statements of Less Complex Entities (ISA for LCE). The Exposure Draft includes proposed updates in several areas, including:

  • Fraud
  • Going Concern
  • Listed and Public Interest Entities
  • Experts

The IAASB welcomes feedback from auditors, regulators, oversight authorities, national standard setters, preparers, investors, and other stakeholders by November 17, 2026.

IASB Proposes Updates to IFRS Accounting Taxonomy 2025

The IASB published a proposed update to the IFRS Accounting Taxonomy 2025. The update sets out proposed changes to the IFRS Accounting Taxonomy to support digital financial reporting of information prepared in accordance with new and amended IFRS Accounting Standards. The deadline for submitting comments is September 14, 2026.

IFRS for SMEs Accounting Standard: New Webcast and Module Available

The IFRS Foundation announced that a new webcast and module on the IFRS for small and medium-sized entities (SMEs) Accounting Standard are available.

IASB Decisions: July 2026 Meeting

The IASB concluded discussions on the Post-implementation Review of IFRS 16 Leases and agreed to propose amendments to IFRS 18 Presentation and Disclosure in Financial Statements on the presentation of specific tax charges. The IASB expects to publish the Project Summary and Feedback Statement on the Post-implementation Review in the fourth quarter of 2026. The IASB expects to publish an Exposure Draft on presentation of specific tax charges in IFRS 18 in the fourth quarter of 2026.

New International Ethics Standards Board for Accountants (IESBA) Staff Publication Highlights Ethical Considerations for Accountants Using Emerging Technologies

The Staff of the IESBA released a new publication, Emerging Technologies: A Characteristics-Based Approach to Ethical Considerations for Professional Accountants, to support professional accountants as they develop, implement, or use emerging technologies in public practice and business.

CAQ

Comment Letter: SEC Proposed Rule on Semiannual Reporting; File Number S7-2026-15

The CAQ posted a comment letter that shares its views and provides input on SEC File No. S7-2026-15, Proposed Rule on Semiannual Reporting, which would provide all companies subject to reporting obligations under Exchange Act Section 13(a) or 15(d) that file quarterly reports the option to file interim reports on a semiannual basis.

How Auditor Expertise Strengthens U.S. Capital Markets

The CAQ shared a blog post written by the CAQ Staff on how audit firms continuously develop their auditors’ expertise to ensure they can interpret complex, fast evolving business practices with accuracy, apply professional skepticism in unfamiliar contexts, and deliver insights that reflect the realities of today’s economy. The CAQ Staff discusses:

  • Building Expertise from Day One
  • Keeping Pace with Technology and Risk
  • The Connection to Audit Quality

Comment Letter: PCAOB QC 1000 Targeted Amendments

The CAQ shared its comment letter to the PCAOB on QC 1000 targeted amendments. The CAQ continues to support the objective of QC 1000. Accordingly, the CAQ supports the targeted refinements proposed by the PCAOB in its supplemental request for comment on proposed amendments to QC 1000, A Firm’s System of Quality Control. The proposed amendments are balanced and responsive to many implementation challenges member firms have experienced. The CAQ continues to encourage the Board to provide additional written implementation guidance, including potential FAQs, to support consistent application of QC 1000.

Institutional Investor Survey Research Findings: AI Use

The CAQ shared the research findings from a survey of institutional investors in the United States that focuses on the use of artificial intelligence in research and analysis for investment decision-making.

The CAQ also posted an article written by Amy O’Connor, Vice President, Public Affairs, on how AI is impacting investors. O’Connor discusses key insights from the survey:

  • AI Is Becoming the First “Set of Eyes” on Many Corporate Disclosures
  • A Trust but Verify Approach
  • What This Means for Today’s Capital Markets

Audit Partners See Companies Moving Forward with Greater Intent as Evolving Risks Reshape Strategy, CAQ Survey Finds

The CAQ released its 2026 Spring Audit Partner Pulse Survey, the latest edition of its recurring report capturing insights from audit partners at the nation’s leading public company audit firms. The Spring 2026 findings show organizations moving forward more deliberately, balancing a steady economic outlook with an increasingly complex risk environment. Insights include:

  • A Steady Outlook, but a Changing Risk Landscape
  • Evolving Risks Drive Strategic Focus
  • AI and Technology Continue to Shape Business Priorities

The CAQ also shared an article written by Amy O’Connor, Vice President, Public Affairs, on the latest edition of the CAQ’s Audit Partner Pulse Survey. O’Connor discusses what these insights reveal about the trends shaping business strategy in the months ahead.

Audit Committee Council (ACC) Comment Letter to the SEC: Filer Status for Reporting Companies

The ACC, an independent advisory committee of the CAQ, submitted a comment letter to the SEC in response to its Proposed Rule on Enhancement of EGC Accommodations and Simplification of Filer Status for Reporting Companies, File Number S7-2026-18 (Filer Status Proposal). Key points included in the ACC letter are:

  • SOX Section 404(b) is an important investor protection.
  • The proposed threshold increase is too broad.
  • We suggest eliminating the five-year seasoning threshold for LAF status.
  • There are additional actions that can reduce burdens on existing public companies, including updating management guidance and modernizing PCAOB inspections.

Comment Letter: SEC Simplification of Filer Status

The CAQ submitted a comment letter to the SEC on its Filer Status Proposal. The CAQ shares the following views:

  • Auditor attestation is an important component of the capital markets ecosystem, and SOX Section 404(b) provides meaningful investor protection benefits.
  • Technology-driven complexity increases the need for robust controls and independent oversight.
  • We do not support a five-year exemption from SOX 404(b) for newly public companies regardless of size, and believe the proposal extends accommodations too broadly.
  • We believe that the objectives of the proposal can be achieved through more targeted and/or alternate reforms.

Monitoring Inflation in Certain Countries

The CAQ shared its International Practices Task Force Document for Discussion: Monitoring Inflation in Certain Countries. The information in the report may be helpful to management in applying US GAAP (ASC 830, Foreign Currency Matters), in conjunction with its internal controls over financial reporting to reach a conclusion on whether a country’s economy should be considered highly-inflationary.

Independence as the Foundation for Trust in an Evolving Market

The CAQ shared an article written by Laura McCracken, Audit & Assurance Partner, Regulatory Leader, Deloitte & Touche LLP, on why auditor independence is central to trust in the U.S. capital market. McCracken discusses the Sarbanes-Oxley Act of 2002, why independence matters, the growing importance of the auditor role as companies adopt emerging technologies, and how evolving tools like AI and analytics can help auditors.

Conversation With SEC Leaders: 5 Takeaways for the Public Company Audit Profession

The CAQ shared an article written by Dennis McGowan, CPA Vice President, Professional Practice and Anti-Fraud Initiatives, on the future regulatory landscape. During the CAQ’s latest Audit Insider webinar, McGowan joined Kurt Hohl, SEC Chief Accountant, Heather Rosenberger, Chief Accountant in the SEC’s Division of Corporation Finance, and the CAQ’s Annette Schumacher, CPA CGMA, Senior Director of Professional Practice, to discuss current initiatives at the SEC. Takeaways from the conversation include:

  • The SEC’s recent proposals are part of a broader effort to make it easier for companies to enter and remain in the public markets.
  • The SEC staff take comment letters seriously, and this Commission is seeking input before drafting some rule proposals.
  • Hohl noted that the PCAOB serves a critical oversight function and is undertaking efforts to modernize its approach to supervision and oversight.
  • Auditor independence remains top of mind.
  • Staff observations point to the same message; they are open for business.
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 www.thecaq.org.

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.

Questions and comments about the Public Policy & Technical Alert can be addressed to Donnie Heinerichs, Manager, Professional Practice (dheinerichs@thecaq.org) or Annette Schumacher, Senior Director, Professional Practice (ashumacher@thecaq.org).
 Auditors, Newsletter, PPTA