PCAOB Substantive Analytical Procedures

TXCPA’s Professional Standards Committee supports PCAOB’s effort to modernize auditing standards on substantive analytical procedures but cautions that removing examples and descriptive language reduces clarity and consistency.

PCAOB Proposed Auditing Standard - Designing and Performing Substantive Analytical Procedures

The TXCPA Professional Standards committee (PSC) supports the Public Company Accounting Oversight Board's (PCAOB) efforts to update and modernize rules and guidance on the use of substantive analytical procedures in the audit by issuing a new standard.

The PSC believes the proposed rules will help bring consistency in the execution of substantive analytical procedures.

However, the proposed standard as drafted does not meet the Board’s objective of clarification in many aspects. We believe the PCAOB erred by “removing descriptive language and illustrative examples” from the current standard.

Additional information is available in the following The Wall Street Journal article published on June 12, 2024: PCAOB Expands Liability for Auditors Involved in Firm Violations

Read the full comment here. View TXCPA PSC comment letter here.

Topics:

You May be Interested in

The IRS May Owe Your Clients Money from the COVID Period
Recent court decisions have opened a largely overlooked opportunity for significant tax refunds based on mandatory disaster relief under IRC Section 7508A during the federally declared COVID-19 disaster period. As a result, interest and penalties assessed during this period may be invalid and refundable, and some taxpayers who received refunds may also be entitled to unpaid overpayment interest. While uncertainty remains and the IRS may resist such claims, timely protective refund filings are critical to preserve clients rights as the statute of limitations continues to run.
TXCPA Advocates for Accounting’s Recognition in Definition of Professional Degrees for Student Loan Eligibility
TXCPA submitted a formal comment to the U.S. Department of Education urging recognition of accounting as a professional degree program to protect graduate-level federal loan access and strengthen the future CPA pipeline.
The Verdict is In. The Texas Franchise Tax is GILTI, Raising New Questions and Potential Issues
Beginning with the 2026 report year, the Texas Comptroller will align the franchise tax with the current Internal Revenue Code, likely requiring GILTI to be included in total revenue. This change raises sourcing, statutory and potential constitutional questions for businesses with foreign operations, creating new uncertainty and possible tax impacts.

More News