PCAOB Evaluates Audit Firm Communications with Audit Committees

On April 5, the PCAOB issued a report regarding compliance with Auditing Standard No. 16, Communications with Audit Committees (AS No. 16), based on its inspections of issuer audits during its 2014 inspection cycle. AS No. 16 became effective for audits of fiscal years beginning on or after December 15, 2012, and requires auditors to communicate with the company's audit committee regarding certain matters related to the conduct of an audit and to obtain certain information from the audit committee relevant to the audit. The purpose of AS No. 16, as noted in the report, is "to improve the audit by establishing requirements that enhance the relevance, timeliness, and quality of the communications between the auditor and the audit committee."