PwC comments on PCAOB's proposed auditor reporting and other information standards

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PwC comment letter (PCAOB) 12/12/2013 by Assurance services
PwC comments on PCAOB's proposed auditor reporting and other information standards

At a glance

PwC supports changes to the audit report and auditor's responsibilities for other information that are responsive to user feedback yet maintain or improve audit quality.

PwC submitted a comment letter on the PCAOB’s proposed auditor reporting and other information standards. PwC commends the PCAOB for this significant step forward to increase the informational value of the auditor’s report, and suggests changes to help reduce unintended consequences and costs while preserving the proposals’ benefits. 

PwC supports the introduction of a new section in the auditor’s report describing critical audit matters (CAM). To avoid the auditor communicating original information about the entity, PwC recommends that CAM be required to be matters that are material to the financial statements and that the auditor’s communication about CAM should not disclose information about the entity that is not required to be disclosed by management. 

PwC also recommends changes to the proposed other information standard to differentiate the work performed on material other information directly related to the audited financial statements from that performed on nonfinancial information, and to include statements in the audit report describing the limited procedures performed and the auditor’s responsibility to describe any inconsistency or material misstatement of fact of which the auditor is aware that has not been appropriately revised.   

PwC does not believe auditor tenure should be included in the audit report but does not object to voluntary disclosure of tenure elsewhere by audit committees or management where proper context can be provided.