What is the PCAOB standards reorganization about?
The Public Company Accounting Oversight Board today approved the reorganization of its auditing standards to help users navigate the standards more easily. The Board adopted amendments to its rules and standards to implement a topical system that integrates the existing interim and PCAOB-issued auditing standards.
Are walkthroughs required by PCAOB?
Now, per AS2, walkthroughs are required when certifying financial reporting controls under Section 404 of the U.S. Sarbanes-Oxley Act of 2002.
What is the difference between PCAOB and GAAP?
The GAAP hierarchy identifies the sources of accounting principles and the framework for selecting principles to be used in preparing financial statements. The PCAOB believes that the GAAP hierarchy is more appropriately located in the accounting standards.
What is PCAOB auditing standards?
The PCAOB board dictates the professional auditing standards that registered auditing firms must use. These standards are utilized to monitor accounting firms. Prior to the PCAOB, standards were set by the AICPA.
When did the PCAOB reorganization become effective?
December 31, 2016
The amendments were approved by the Securities and Exchange Commission on September 17, 2015. The amendments were effective as of December 31, 2016.
What are walkthroughs in audit?
A walk-through test is a procedure used during an audit of an entity’s accounting system to gauge its reliability. A walk-through test traces a transaction step-by-step through the accounting system from its inception to the final disposition.
What is the difference between FASB and PCAOB?
Currently, the SEC recognizes the Financial Accounting Standards Board (FASB) as the designated authority for establishing GAAP. SOX created the Public Company Accounting Oversight Board (PCAOB) to oversee the auditing profession for the private sector. The SEC has oversight responsibility over FASB and PCAOB.
Are walkthroughs required in an audit?
While walkthroughs are not specifically required in the audit standards, you do need to verify your understanding of the accounting system and related controls.
What is the difference between walkthrough and test of controls?
Walkthrough is an audit procedure that we perform to understand the client’s accounting system and controls….Is a walkthrough a test of controls?
| Difference between walkthrough and test of controls | |
|---|---|
| Perform on a single transaction | Perform on a sample of transactions to obtain sufficient evidence |
What are the six financial statement assertions?
They are accuracy and valuation, existence, completeness, rights and obligations, and presentation and disclosure.