June 8, 2026
 

Public Policy and Technical Alert | May 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

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

The SEC updated the CFIs around the following topics:

SEC Proposes Amendments to Permit Optional Semiannual Reporting by Public Companies

The SEC proposed rule and form amendments that would give  public companies the option of filing semiannual reports in lieu of quarterly reports to meet their interim reporting obligations under federal securities laws. A factsheet summarizing the rule and a statement by Chairman Atkins were released as well.

The public comment period will remain open until July 6. Comments can be submitted here.

SEC Proposes Reforms to Registered Offerings and Reporting Requirements

The SEC proposed amendments to its rules and forms governing registered offerings that are designed to increase efficiency, flexibility, and cost savings for public companies while maintaining robust investor protections. The Registered Offering Reform Proposal, if adopted, would allow a greater number of public companies to conduct shelf offerings regardless of the company’s public float. The Filer Status and Emerging Growth Company Accommodation Reform Proposal would:

  • Extend current disclosure scaling and other accommodations to most public companies;
  • Grant the smallest public companies extended deadlines to file their periodic reports;
  • Simplify the public reporting company filer status framework; and
  • Update the Commission’s Regulatory Flexibility Act issuer “small entity” definitions. Fact sheets and a statement from Chairman Atkins are available on the same webpage.

The public comment period for the Filer Status and Emerging Growth Company Accommodation Reform Proposal will remain open until July 20. Comments can be submitted here.

The public comment period for the Registered Offering Reform Proposal will remain open until July 27. Comments can be submitted here.

SEC Investor Advisory Committee Holds June 4 Meeting

The SEC held a meeting of its Investor Advisory Committee at the SEC Headquarters in Washington, D.C., on June 4, 2026 to discuss private markets, passive index funds, and  recommendations regarding fund proxy voting and quarterly versus semiannual reporting.

The full agenda is available on the committee’s webpage. A replay will be posted here.

SEC Proposes Rescission of Climate-Related Disclosure Rules

The SEC proposed the rescission of the rules that require companies to provide certain climate-related information in their registration statements and annual reports. The public comment period will remain open until August 3. Comments can be submitted here.

​​PCAOB

PCAOB Updates Standard-Setting, Rulemaking, and Research Projects As Strategic Planning Process Continues

The PCAOB posted updates to its Standard-Setting, Research, and Rulemaking Projects webpage. This webpage discusses certain staff activities that are being performed in the interim period until comments on the PCAOB’s strategic priorities are received and analyzed by the PCAOB’s staff, and a new standard-setting, research, and rulemaking agenda is issued.

PCAOB Announces Inspections Modernization Council, Seeks Participation From Outside Experts

The PCAOB announced that it is forming a new advisory body, the Inspections Modernization Council, and is seeking outside parties with a stake in the PCAOB’s inspection activities to participate in its work. The application period will close on June 15, 2026.

FASB

FASB Issues Standard on Environmental Credits and Environmental Credit Obligations

The FASB issued an Accounting Standards Update (ASU) to improve the financial accounting for and disclosure of activities related to environmental credits and environmental credit  obligations. It provides recognition, measurement, presentation, and disclosure requirements for all entities that generate, purchase, or receive environmental credits or have a regulatory compliance obligation that may be settled with environmental credits. The ASU, including effective date and transition information, is available at Accounting Standards Update 2026- 02—Environmental Credits and Environmental Credit Obligations  (Topic 818).

​​​​​AICPA

AICPA Submits Comment Letter to the Office of the Comptroller of the Currency (OCC) on GENIUS Act Rulemaking

The AICPA submitted a comment letter to the OCC encouraging regulators to leverage the AICPA’s recently published 2025 Criteria for Stablecoin Reporting in its rulemaking to strengthen transparency, accountability, and trust in the U.S. payment stablecoin market.

AICPA Updates Standards Involving Audit Confirmations

The AICPA’s Auditing Standards Board approved a standards update that would modernize how CPAs obtain audit evidence through external confirmation procedures. The new Statement on Auditing Standards: External Confirmations will be effective for firms on December 15, 2028, although early adoption is possible.

International

International Auditing and Assurance Standards Board (IAASB) Seeks Feedback on Proposed Revisions to International Standard on Review Engagements (ISRE) 2410 to Strengthen Interim Review Engagements

The IAASB released for public consultation an Exposure Draft that proposes revisions to ISRE 2410, Review of Interim Financial  Information by the Independent Auditor of the Entity’s Annual Financial Statements. Key proposals include a clearer articulation of what an interim review engagement is and how it differs from a financial statement audit. Comments are requested by September 3, 2026.

May 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 May 18-22, 2026, IASB meeting are now available. The IASB Update and podcast are also available here.

IASB Proposes Extending Consolidation Exception for Eligible SMEs

The IASB published an Exposure Draft proposing narrow-scope amendments to the IFRS for SMEs Accounting Standard. The proposal introduces a consolidation exception for intermediate parents that have a parent or ultimate parent that is an investment entity and that does not produce consolidated financial statements. The consultation is open for comment until September 9, 2026. If approved, the amendments will become effective for periods beginning on or after January 1, 2027.

IASB Extends Comment Period for Its Proposed Risk Mitigation Accounting Model Consultation

The IASB extended the comment period on its Exposure Draft Risk Mitigation Accounting — Proposed amendments to IFRS 9  and IFRS 7 until November 30, 2026. Since the IASB also  proposes to withdraw IAS 39 Financial Instruments: Recognition and Measurement in the Exposure Draft, it wants to hear from companies that may be affected, including those that do not expect to apply the proposed Risk Mitigation Accounting model.

June 2026 FASB–IASB Education Agenda and Meeting Papers Now Available

The IFRS Foundation announced that the June 2026 FASB–IASB education agenda and meeting papers are now available.

International Ethics Standards Board for Accountants (IESBA) Releases Guide on Proportionality of the IESBA Code

The IESBA released a guide to its approach to proportionality in the ethics and independence standards in the IESBA Code. The publication entitled Proportionality of the IESBA Code explains how these proportionality mechanisms work in practice across three key dimensions:

  • The Code’s conceptual framework;
  • The Code’s building-blocks architecture; and
  • Clearly differentiated provisions.

International Forum of Independent Audit Regulators (IFIAR) 2025 Annual Report

The IFIAR released its 2025 Annual Report.

International Organization of Securities Commissions (IOSCO) Publishes AI Supervisory Toolkit

The IOSCO published a Supervisory Toolkit for AI Use in Capital  Markets. The report provides regulators with a practical toolkit to support the supervision and oversight of artificial intelligence (AI) based systems used by regulated entities.

CAQ

Comment Letter: OCC Proposed Rulemaking to Implement the GENIUS Act

The CAQ posted its comment letter to the OCC in response to the  agency’s proposed rulemaking on Implementing the Guiding and Establishing National Innovation for U.S. Stablecoins Act for the  Issuance of Stablecoins by Entities Subject to the Jurisdiction of the Office of the Comptroller of the Currency. In the letter, the CAQ supports the OCC’s objective to enhance transparency, reliability, and accountability for permitted payment stablecoin  issuers. The CAQ offers views on:

  • Audits of financial statements for certain permitted payment stablecoin issuers;
  • Examination of monthly composition reports; and
  • Mechanisms to increase transparency and reliability of information reported by permitted payment stablecoin issuers, including examinations of internal controls over stablecoin operations and reserves.

Meeting Highlights: SEC Regulations Committee, March 2026

The CAQ shared the highlights of the March 2026 joint meeting of the SEC Regulations Committee and the SEC Staff. Topics addressed at the meeting include:

  • Smaller Reporting Company (SRC) status following a change in fiscal year end;
  • SRC status determination when annual revenues previously exceeded $100 million;
  • Corporation Finance Interpretations (CFI) 130.05 and filer status determination upon consummation of a de-SPAC transaction; and
  • Filing interim financial information for private operating company when a reverse merger between two operating companies occurs after fiscal quarter end, but before Form 10-Q is due.

ACC Comment Letter to the PCAOB: Strategic Priorities

The Audit Committee Council (ACC), an independent advisory  group of the CAQ, submitted a comment letter to the PCAOB  outlining key recommendations for the Board’s 2026–2030  strategic priorities. The ACC strongly supports the PCAOB’s investor protection mission and emphasizes the need for a more effective, consistent, and transparent regulatory framework that  enhances audit quality while reducing unnecessary burden on stakeholders. The top recommendations included in the letter include:

  • Strengthen the PCAOB inspections program;
  • Promote regulatory efficiency and durable standards; and
  • Prioritize initiatives with the greatest impact.

CAQ Comment Letter on PCAOB Strategic Priorities

The CAQ shared its comment letter submitted in response to the PCAOB’s request for comment on its strategic priorities. In the letter, the CAQ recommend that the PCAOB prioritize its activities in four key areas:

  • Modernize the design of inspections to appropriately incorporate firms’ systems of quality control under QC 1000;
  • Execute the inspection process with transparency, timeliness, and consistency;
  • Improve inspection reporting to focus on material matters and meet stakeholder needs; and
  • Pursue standard setting selectively and based on demonstrated need supported by a formal and transparent agenda-setting process.

AI, Deepfakes, & Digital Assets: Fighting Fraud in an Era of Emerging Technologies

The CAQ posted an article written by Erin Cromwell, CPA, Senior Manager, Professional Practice, on how emerging technologies, including generative AI (genAI) and digital assets, are shaping the financial reporting fraud landscape. Cromwell discusses:

  • GenAI: Technology That Cuts Both Ways
  • Digital Assets: A Regulatory Priority in 2026
The CAQ champions the public interest in the capital markets by:
  • Elevating the quality, credibility, and transparency of public company audits;
  • Advancing critical issues affecting public company audits;
  • Driving innovation in assurance; and
  • Providing a collaborative forum for capital market stakeholders to address evolving needs and challenges.
As the voice of the public company audit profession, we work to instill trust in corporate reporting and the integrity of the auditing process, ultimately empowering investors, companies, and society as a whole. 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