Audit quality indicators are a potential portfolio of quantitative measures that may provide new insights about how high quality audits are achieved. Taken together with qualitative context, the indicators may inform discussions among those concerned with the financial reporting and auditing process, for example among audit committees and audit firms. Enhanced discussions, in turn, may strengthen audit planning, execution, and communication.
Concept Release on Audit Quality Indicators
The responsibilities of the Public Company Accounting Oversight Board under the Sarbanes-Oxley Act of 2002, as amended, are all ultimately directed at improving audit quality and thereby benefiting investors. The Board's audit quality indicator project can be an important part of that effort. A portfolio of quantitative measures of public company auditing (called "indicators"), used consistently, could enhance dialogue about and understanding of audits.
PCAOB Dialogues Podcast
In the first PCAOB Dialogues episode, Former Director of Office of Research and Analysis Greg Jonas answers questions about the history and purpose of the project and provides specific examples of potential indicators. Mike Cook provides insight into how audit committees could use indicators to may help them do their jobs. All participants speak for themselves and do not represent the PCAOB as a whole, or the Board or the staff.
The PCAOB's Standing Advisory Group (SAG) and Investor Advisory Group (IAG) provide views and advice to the Board on issues related to its work. Both groups have discussed audit quality indicators. Some of the materials from the meetings can be found below. For the full agenda click on the meeting.
- Audit Quality Indicators Discussion Presentation
- SAG Meeting Update on Audit Quality Indicators
- Summary of SAG Breakout Discussions
- Initiatives to Improve Audit Quality -- Root Cause Analysis, Audit Quality Indicators, and Quality Control Standards
- Usage of Audit Quality Indicators