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Enhancing public trust in the capital markets by promoting high-quality financial reporting.

<p>The Center for Audit Quality</p>

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Discover the latest insights, resources, and standards in auditing and accounting at the Center for Audit Quality (CAQ) website. Access valuable guidance, research, and tools to enhance your expertise and stay informed in the ever-evolving auditing landscape. 

<strong><span style="color: #1e376c;"><em>Follow Julie on Twitter</em></span> <a href="https://twitter.com/JulieBLindsay">@JulieBLindsay</a></strong>

Julie Bell Lindsay is the Chief Executive Officer of the Center for Audit Quality (CAQ), a position she has held since May 2019. As CEO, Julie is responsible for leading the CAQ in fulfilling its mission of championing the public interest in the capital markets by elevating the quality, credibility and transparency of public company audits and the role of assurance in our markets.

Previously, Julie served as a Managing Director and the Deputy Head of Global Regulatory Affairs at Citigroup, a position she began in February 2017. In that role, Julie worked to formulate and execute Citi’s regulatory policy priorities and strategy across the numerous U.S. and international regulatory agencies with oversight over Citi. Julie joined Citi in February 2009 as General Counsel – Capital Markets and Corporate Reporting, where she was the lead internal lawyer responsible for Citi’s public disclosures and global capital markets activities. During this time, she led the internal and external teams in Citi’s $20 billion TARP repayment, involving the then-largest public equity offering in US capital markets history, as well as its $58 billion exchange offers designed to boost Citi’s capital levels post-financial crisis.

Prior to Citi, Julie served as Counsel to Commissioner Cynthia Glassman at the US Securities and Exchange Commission, where she counseled the Commissioner on matters relating to public company disclosure obligations, corporate governance standards, the Sarbanes-Oxley Act of 2002, the PCAOB and FASB, enforcement matters, and issues affecting registered foreign companies. Julie also has securities and public company reporting and governance experience as Counsel and Associate at law firms in Washington, DC and Palo Alto, CA.

Julie graduated from The Ohio State University in 1993 with a BA in political science and received her JD from Vanderbilt School of Law in 1996. She serves as a Member of the Board of Directors of the Foundation for the National Institutes of Health, where she Chairs the Audit and Finance Committee, and as a Member of the Dean’s Advisory Council of the College of Arts &amp; Sciences at The Ohio State University.

Julie Bell Lindsay

Dear Readers,

For those who regularly engage with the CAQ and our content, you know that I like to state my outlook for the public company audit profession at the start of each year. While change in the profession has historically...

Dear Readers,

For those who regularly engage with the CAQ and our content, you know that I like to state my outlook for the public company audit profession at the start of each year. While change in the profession has historically moved at a steady pace, the last couple of years have defied this old logic – particularly on the regulatory front. A new pace of change at the PCAOB has redefined their approach to standard-setting, enforcement, and the inspections program. The public company audit profession has also embraced a new pace of change, investing in talent and rapidly developing forms of technology to enhance audit quality.

While we’ve taken a short breather since the close of 2024, I do not expect this reprieve to last long. From a new Administration to the pipeline and talent challenges we face as a profession – I am prepared for an incredibly significant year.

With these key issues in mind, here are my thoughts on the outlook for 2025.
<h3><strong>The Regulatory Landscape: More Changes on the Horizon</strong></h3>
The evolving landscape of regulation and oversight will continue to shape the public company audit profession. On the SEC front, recent Supreme Court cases like Chevron and Jarkesy signal shifts in the boundaries of the Commission’s authority and enforcement capabilities, respectively. And how these rulings impact the PCAOB – whether through the SEC’s oversight of the PCAOB or otherwise – remains to be seen or tested.

As mentioned in the intro, the PCAOB has passed several standards that audit firms must prepare to implement in 2025, with a handful of others still pending approval (e.g., NOCLAR at the PCAOB; firm and engagement metrics and firm reporting at the SEC). The CAQ has supported the PCAOB’s efforts to update its standards given the fast-paced nature of our capital markets and how audit practices and stakeholder demands have evolved. As we look ahead to standard-setting in 2025, we believe it will be critical for the PCAOB to enhance standard-setting by taking an approach that focuses on engaging with a broad group of stakeholders and incorporating data-driven and rigorous cost-benefit analyses to develop evidence-based, future-ready standards.

Effective regulation of the public company audit profession also depends on impartiality, including from externalities like politics, transparency, and expertise to safeguard the public interest and foster trust. With various discussions happening in Washington, I think it is important not to lose sight of what is working. While no framework can completely eliminate risks, the Sarbanes-Oxley Act created a robust system of checks and accountability, which continues to foster trust in the integrity of financial reporting and the capital markets. The public company audit profession will continue to adapt and innovate to ensure the capital markets retain their integrity and reliability in the face of new challenges.

[custom_quote text="The CAQ has supported the PCAOB’s efforts to update its standards given the fast-paced nature of our capital markets and how audit practices and stakeholder demands have evolved."]
<h3><strong>Emerging Technology: A Role for the Audit Profession </strong></h3>
The new Administration’s technological priorities have reinvigorated public discourse about innovations like artificial intelligence (AI) and digital assets like cryptocurrency.

Audit firms are making significant investments to harness the transformative potential of genAI, with $6.4 billion in investments announced by some of the leading firms in the last two years. By automating repetitive tasks, AI enables auditors to concentrate on more complex and judgment-intensive areas, leading to more meaningful insights. This shift is also reshaping the early stages of an auditor’s career, offering opportunities to work on innovative and engaging projects. As a profession, we need to continue to spotlight and educate stakeholders on how audit firms are using – or could use – this technology to further enhance audit quality.

Auditors are also engaging with AI more as public companies increasingly report use of this form of technology. According to <a href="https://news.bloomberglaw.com/securities-law/ai-disclosures-to-sec-jump-as-agency-warns-of-misleading-claims">Bloomberg</a>, 40% of S&amp;P 500 companies mentioned AI in their most recent annual filings to the SEC. Our <a href="https://www.thecaq.org/audit-partner-pulse-survey">research</a> shows that AI is being utilized across business functions, from automation to predictive analysis. With AI becoming ingrained in business functions, investors want to better understand this rapidly evolving form of technology’s impact on a public company's bottom line. And policymakers, recognizing the value of independent checks and balances on company processes and reported information, have taken steps to require assurance over this information (see, e.g., Senator Hickenlooper’s “<a href="https://ww2.aip.org/fyi/federal-science-bill-tracker/118th/senate-4769#:~:text=A%20bill%20to%20require%20the,systems%2C%20and%20for%20other%20purposes.">Validation and Evaluation for Trustworthy AI (VET AI) Act.</a>”).  AI systems that behave more like humans are a rapidly evolving landscape with substantial investments but as we've seen with digital technologies a new entrant can <a href="https://www.washingtonpost.com/business/2025/01/27/deep-seek-ai-markets-nvidia/">quickly become a disruptor</a>.

Similarly, as <a href="https://www.cryptoglobe.com/latest/2025/01/corporate-bitcoin-holdings-surge-in-2024-with-momentum-continuing-into-2025/">more companies</a> engage with cryptocurrency, and with the SEC likely <a href="https://www.accountingtoday.com/news/sec-withdraws-accounting-guidance-on-crypto-assets">taking a different stance</a> on the digital currency under Chair Paul Atkins, this is also clearly a space to watch.  As regulatory frameworks develop, a question arises as to whether there is a role for the independent public company audit profession to bring the same rigor, knowledge of the businesses they audit, and commitment to quality that defines financial statement audits to company-reported information around crypto – I believe there is.

[custom_quote text="With AI becoming ingrained in business functions, investors want to better understand this rapidly evolving form of technology’s impact on a public company's bottom line."]
<h3><strong>The Future of the Profession: Tackling the Talent Challenge with Creative Solutions</strong></h3>
The accounting and auditing profession continues to face a pipeline challenge, with fewer individuals pursuing the degree and CPA designation in recent years. This trend is exacerbated by the declining college enrollment and overall decrease in the number of high school students in many parts of the country. While technology certainly impacts talent – whether the demand, required skillset, or attractiveness – it is not the sole solution.

Rather, as many of you have heard me say, the talent challenge – both pipeline and retention – is a multifaceted issue requiring a multifaceted solution where all have a role to play. The CAQ’s <a href="https://www.joinaccountingplus.com/sign-up?utm_source=google&amp;utm_medium=paidsearch&amp;utm_campaign=%5bCAQ%5d_Search_Branded_Accountingplus&amp;utm_term=joinaccountingplus&amp;gad_source=1&amp;gclid=CjwKCAiAneK8BhAVEiwAoy2HYT0kxSelWU_rprOgyB5vU_KAjStxwOPf-OU59VoeJJVO9B5QLF3PrRoCXLkQAvD_BwE">Accounting+</a> campaign is targeting the awareness and <a href="https://www.thecaq.org/increasing-diversity-in-the-accounting-profession-pipeline-2022">misperceptions</a> of what a career in accounting and auditing is, and where it can lead. The AICPA’s National Pipeline Advisory Group published a <a href="https://www.accountingpipeline.org/wp-content/uploads/2024/08/NPAG-Strategy-Report.pdf">report</a> to address the talent shortage with potential solutions in six thematic areas. Audit firms are <a href="https://www.wsj.com/opinion/the-dying-language-of-accounting-cpa-licensing-fede2e74">raising their starting salaries</a>.  And alternative pathways to obtaining a CPA license, <a href="https://www.thecaq.org/pipelineresearch2023">identified by many students</a> as a barrier to entering the profession, are in development across many states. For example, Ohio’s Governor Mike DeWine recently <a href="https://www.cfodive.com/news/ohio-gov-signs-alternative-cpa-licensure-pathway-bill-law-accounting-aicpa/736942/">signed into law</a> reforms to permit an added year of experience to meet the “additional 30 hour” requirement under the existing licensure model. It is expected that other states will follow this approach in 2025.

All of these initiatives, which will of course take time to alleviate the talent crisis we are experiencing today, reflect the efforts of many to ensure the profession remains robust and adaptable to the needs of an evolving marketplace.

[custom_quote text="Alternative pathways to obtaining a CPA license, identified by many students as a barrier to entering the profession, are in development across many states."]
<h3><strong>The Audit Effect: The Value of Assurance in 2025 and Beyond</strong></h3>
At its core, the assurance provided by public company auditors serves as a cornerstone of trust in the $55 trillion US capital markets, which comprise 40% of the world’s capital markets. The work of assurance supports informed decision-making, fosters accountability, and strengthens public confidence in the integrity of organizations—ultimately contributing to the stability and resilience of our capital markets.

In other words, audits matter because they create trust, which enables stability, which instills confidence. This is what the profession calls “The Audit Effect.”

Despite the potential for significant change, as I look ahead to 2025, I believe the “Audit Effect” will remain steadfast. As the profession evolves, the principles of independence, reliability, and transparency will continue to guide public company auditors in serving society, ensuring that assurance remains a vital pillar of economic and organizational resilience in the years to come.

Thank you for engaging with us, supporting the CAQ and supporting public company auditors.  To stay up-to-date on the CAQ’s work, visit caq.org or follow us on <a href="https://www.linkedin.com/company/2859773">LinkedIn</a>.

[custom_quote text="As the profession evolves, the principles of independence, reliability, and transparency will continue to guide public company auditors in serving society."]

Julie Bell Lindsay,
Chief Executive Officer, CAQ

2025 Profession Outlook: Auditors Will Continue to Provide Stability and Dependability During Changing Times

Auditors

Audit Committee

Investors

Auditor Independence

Talent

Company Management

Audit Quality

Emerging Reporting Areas

Blog Post

Hosted by Julie Bell Lindsay, CEO of the Center for Audit Quality, Capital Markets Pulse dives into the latest key matters related to the capital markets featuring experts from across the corporate reporting world.

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Hosted by Julie Bell Lindsay, CEO of the Center for Audit Quality, Capital Markets Pulse dives into the latest key matters related to the capital markets featuring experts from across the corporate reporting world.

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Podcast | Capital Markets Pulse, Episode 11: Mike Scanlon

Policymakers

Podcast

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Bouyer_Ken_EY

Ken Bouyer

EY Americas Director of Inclusiveness Recruiting

kutz_diana_ey

Kutz_Diana_EY

Diana Kutz

EY Americas Assurance Talent Leader

Against the black and gold backdrop of the Pittsburgh Steelers, some inspiring conversations are taking shape.

The Steelers Showcase, powered by Accounting+, is a series of events helping to educate curious high school students about accounting careers and the broader scope...

Against the black and gold backdrop of the Pittsburgh Steelers, some inspiring conversations are taking shape.

The Steelers Showcase, powered by Accounting+, is a series of events helping to educate curious high school students about accounting careers and the broader scope of the profession. From Acrisure Stadium to the UPMC Rooney Sports Complex, the Steelers practice facility, participants from Ernst &amp; Young LLP (EY US) and other Big Four firms team up with members of the Pittsburgh accounting community to explain what it is like to be an accountant and answer students' questions about career experiences.

More than just bean counters and number crunchers, accountants draw parallels between their daily endeavors and the high-stakes, game-time decisions made by football players. Because accounting, much like football, is a dynamic field centered around strategic problem solving and innovation. It’s about navigating complex scenarios and finding solutions, just without the imminent threat of a linebacker waiting, poised for a tackle. And by connecting with high school students around America’s sport, EY, the Center for Audit Quality (CAQ) and the rest of the profession are making accounting tangible and accessible, hoping to usher in a new generation of future CPAs.

[custom_quote text="Accounting, much like football, is a dynamic field centered around strategic problem solving and innovation."]

<img class="alignnone wp-image-15720 size-full" src="https://www.thecaq.org/wp-content/uploads/2024/12/2024_12_AiA_EY-Steelers-1.png" alt="" width="800" height="500" />
<h3><strong>Where are all the accountants?</strong></h3>
The accounting profession is facing a critical challenge. Demand for accountants remains robust, but the number of students sitting for the CPA exam is simply not keeping pace. The need for accounting graduates remains strong while the pipeline contracts.<sup>1</sup> In fact, the number of new CPA candidates declined by more than 35% between 2016 and 2022.<sup>2</sup>

One challenge in attracting students to the profession is the added time and cost associated with CPA licensure. In its report, <em>Increasing Diversity in the Accounting Profession Pipeline: Challenges and Opportunities</em>, the Center for Audit Quality (CAQ) found that 52% of non-accounting students point to the 150-hour CPA requirement as a financial barrier to considering a career in accounting, with even higher levels of concern among Black (62%) and Hispanic (69%) students.

While the challenge is not new, the way EY US and other firms are taking action to have a lasting impact on the future of the profession is.

[custom_quote text="One challenge in attracting students to the profession is the added time and cost associated with CPA licensure."]
<h3><strong>A bold investment </strong></h3>
In June, EY US took a bold step that we hope will be a catalyst for broadscale change. The firm announced a $1 billion, three-year investment in compensation and technology. To attract and retain the next generation of accounting talent, firms need to offer salaries that are competitive with those offered to other business majors — especially when they are required to invest in additional education to become a CPA. Our intent is to help “move the market” for accounting professionals, so that salaries reflect the value CPAs bring to the companies we serve and to the capital markets.

There is no denying that pay is a powerful motivator; however, our investment in the future of accounting is much broader. To attract and retain diverse talent to accounting, we are helping students see themselves in the profession. We also are creating the early career experiences that give them a platform to build a career that is uniquely suited to their interests and passions.

[custom_quote text="There is no denying that pay is a powerful motivator; however, our investment in the future of accounting is much broader."]
<h3><strong>Accessible and affordable career pathways </strong></h3>
Our latest investment builds on the EY Career Path Accelerator — a program that provides an alternative pathway to CPA licensure, <strong>making the profession more affordable and accessible</strong>. Since 2021, the EY Career Path Accelerator has helped EY US interns interested in pursuing accounting undergraduate majors who need a more accessible and affordable path to becoming CPA-eligible. Through a series of virtual courses offered by Hult International Business School and hands-on learning during their internships, participants learn future-focused skills and gain subject-matter knowledge they will need to eventually pursue licensure. The EY Career Path Accelerator has assisted 845 interns since inception, with the Ernst &amp; Young Foundation awarding over $820,000 in financial aid.
<h3><strong>A shared responsibility </strong></h3>
As ambassadors for the accounting profession, it is our shared responsibility to engage with students — sparking their interest in the world of accounting. Each of us can ask the insightful questions that unlock that opportunity for the next generation of accounting professionals. By showcasing the dynamic and impactful nature of accounting and providing accessible pathways into the profession, we can open their eyes to the diverse opportunities that accounting offers and secure a thriving future for the industry.

<em>The views reflected in this article are the views of the author and do not necessarily reflect the views of Ernst &amp; Young LLP or other members of the global EY organization.</em>

&nbsp;

<hr />

<h3><strong>EY people connect purpose with accounting – watch their stories</strong></h3>
<p class="whitespace-pre-wrap" style="margin: 15.0pt 0in 15.0pt 0in;"><a href="https://www.ey.com/en_us/careers/your-career-in-accounting">Accounting careers at EY | EY - US</a></p>
<a href="https://www.ey.com/en_us/careers/your-career-in-accounting"><img class="alignnone wp-image-15718 " src="https://www.thecaq.org/wp-content/uploads/2024/12/2024_12_AiA_EY-Steelers-Sidebar.png" alt="" width="500" height="386" /></a>

<hr />

<h4><em><strong>About the authors</strong></em></h4>
Ken Bouyer is the EY Americas Director of Inclusiveness Recruiting, responsible for driving the EY Americas diversity recruitment strategy. Ken is involved with several professional organizations, including NABA and ALPFA, and has been recognized with awards for his work in promoting diversity in accounting. He holds a bachelor’s degree in Accounting from Manhattan College and is a Certified Internal Auditor. Ken lives in New Jersey with his family.

Diana Kutz is the EY Americas Assurance Talent Leader, with over 20 years’ human resources experience operating as a strategic partner enabling business goals, driving talent management and fostering a positive culture, and a visionary for innovative talent solutions. Diana sits on the Conference Board with select senior executives committed to advancing work at the intersection of business performance and societal advancement and has been recognized by the Association for Talent Development (ATD) for elevating the employee experience.

&nbsp;

<hr />

<strong>Endnotes</strong>
<h6>1. “Accountants and Auditors,” <em>Occupational Outlook Handbook</em>, Bureau of Labor Statistics, U.S. Department of Labor,
<a href="https://www.bls.gov/ooh/business-and-financial/accountants-and-auditors.htm">https://www.bls.gov/ooh/business-and-financial/accountants-and-auditors.htm</a>.</h6>
<h6>2. Ibid., p. 17.</h6>

Building a more diverse CPA pipeline

Hosted by Julie Bell Lindsay, CEO of the Center for Audit Quality, Capital Markets Pulse dives into the latest key matters related to the capital markets featuring experts from across the corporate reporting world.

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&nbsp;
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Podcast | Capital Markets Pulse, Episode 10: Sam Ross

thomas-makenzie

Thomas Makenzie

KPMG US and Global Audit Chief Technology Officer 

AI and GenAI are transforming the landscape of financial reporting, driving innovation and improvements in quality and efficiency. In the next three years, 100% of US financial reporting leaders report they will be either piloting or using AI in financial...

AI and GenAI are transforming the landscape of financial reporting, driving innovation and improvements in quality and efficiency. In the next three years, 100% of US financial reporting leaders report they will be either piloting or using AI in financial reporting, according to a recent KPMG <a href="https://kpmg.com/us/en/media/news/ai-in-financial-reporting-kpmg-2024.html">survey on AI in financial reporting</a>.

As companies engage more with AI and GenAI capabilities in this 'AI era,' they will face new opportunities, risks and challenges. Financial reporting leaders are focused on navigating these risks by becoming AI-ready and expect their external auditor to not only use AI and GenAI in the audit, but also use professional judgement to evaluate control environments.

In fact, 83% of financial reporting leaders believe it is important for auditors to utilize AI in performing their analysis, prioritizing risk and anomaly identification, data analysis and quality management, and risk mitigation and real-time auditing.
<h3><strong>Enhancing audit quality with AI </strong></h3>
At KPMG, we are accelerating our use of AI in the audit, anchored by our Trusted AI framework, to continue enhancing quality and uncovering deeper insights for audit committees and management.

Last year, we deployed KPMG Audit Chat, our proprietary GenAI tool built on Azure OpenAI service, which includes a library of use cases. Audit Chat now <a href="https://kpmg.com/us/en/media/news/kpmg-audit-chat-new-capabilities-2024.html">helps auditors consult our methodology and the standards, review documentation and more</a>.

Today, we’ve <a href="https://kpmg.com/us/en/media/news/kpmg-ai-integration-clara-2024.html">embedded our GenAI assistant directly into KPMG Clara</a>, our global smart audit platform, for 90,000 auditors around the globe. Like an additional team member, this capability can interact directly with audit engagement documentation and our audit methodology to help auditors refine risk assessments, develop substantive testing procedures and enhance audit documentation.

Additionally, we are using directed AI and machine learning to conduct transaction scoring through our global alliance with MindBridge. With KPMG Clara Transaction Scoring, our teams are able to perform analyses over 100% of transactional populations, delivering audit evidence and identifying outliers over both general ledger and subledger populations. Transaction Scoring also enables our teams to refine risk assessments and unlock deeper, data-driven insights for audit committees and management teams.

AI is freeing up resources for our auditors to spend more time on the areas of highest risk, sector-specific risks and challenges – to the benefit of both stakeholders and the capital markets.

[custom_quote text="AI is freeing up resources for our auditors to spend more time on the areas of highest risk, sector-specific risks and challenges."]
<h3><strong>Protecting the capital markets with trust</strong></h3>
Our focus areas align with the demands of audit committees and management teams. Our research finds that companies across the US are eager to realize the benefits of an AI-enabled financial reporting process.

Among financial reporting leaders, the top expected benefits of AI in the next three years include real-time insights into risks, fraud and control weaknesses (73%), increased data accuracy and reliability (67%) and lower costs (62%). In addition, 60% expect greater ability to predict trends and impacts.

Importantly, our Trusted AI approach ensures we are deploying AI in the audit with a human-in-the-loop mindset to maintain quality and accuracy. Our teams are trained on how to effectively use AI as an enabler, ensuring our professionals are critically engaging outputs and exercising professional skepticism.
<h3><strong>Empowering our professionals with AI </strong></h3>
AI will augment, not replace, the role of the auditor, and the audit will always be people-driven. Our methodology, audit standards, industry dynamics and a business’s particular risks are integrated through human judgment and decision.

We believe AI will pull more people into the profession. By reducing manual work, people are free to focus on more strategic, higher-level thinking. Moreover, as the role of the auditor expands to protect the capital markets, the mission and purpose that drives our profession today will only increase.

[custom_quote text="AI will augment, not replace, the role of the auditor, and the audit will always be people-driven."]
<h3><strong>Looking ahead </strong></h3>
The use of AI and GenAI is becoming ubiquitous, with 58% of financial reporting leaders seeing GenAI as the number one technology priority in the next year.

At KPMG, where we are today is just the tip of the iceberg. As our technology teams and auditors gain more experience with GenAI, we expect to accelerate innovation across our audits.

More broadly, the benefits of AI will only grow as firms continue investing in and deploying new capabilities, and in the future, these trends will fundamentally shape the competitive positioning of finance functions in business strategy. At the same time, auditors will have the opportunity to become consistent collaborators with organizations as they embrace AI as a business enabler and navigate the increasingly dynamic, digitally connected market.

Transforming the audit experience with AI

Audit Committee Effectiveness: A Webinar Series | Episode 7
Welcome to Audit Committee Effectiveness: a webinar series brought to you by the Center for Audit Quality and the National Association of Corporate Directors. The series explores key takeaways and insights from...

<h4>Audit Committee Effectiveness: A Webinar Series | Episode 7</h4>
<em>Welcome to Audit Committee Effectiveness: a webinar series brought to you by the Center for Audit Quality and the National Association of Corporate Directors. The series explores key takeaways and insights from leaders in the financial reporting ecosystem alongside resources developed to aid audit committees and public company board members. Stay tuned to this page for information about topics, participants, and how to register for upcoming webinars.</em>

<img class=" wp-image-12997 alignnone" src="https://thecaq.wpenginepowered.com/wp-content/uploads/2022/11/CAQ_NACD_400x150.png" alt="CAQ NACD" width="200" height="75" />

In our initial AI 101 for Audit Committees <a href="https://www.thecaq.org/artificial-intelligence-ai-101-for-audit-committees">webinar</a>, we tackled how recent advancements, powered by the likes of OpenAI’s ChatGPT and Google’s Gemini, has captured the attention of corporate leaders around the world.  Corporate boards are focusing on better understanding the technology and establishing guardrails to ensure risks of information security, data quality, hallucinations, and other areas are appropriately managed.

Now, in the second of a 2-part series, speakers <a href="https://www.ey.com/en_us/people/richard-jackson">Richard Jackson</a> (Global Artificial Intelligence Assurance Leader, EY) and <a href="https://www.linkedin.com/in/hrncirik/">Cory Hrncirik</a> (Modern Finance Lead, Microsoft) join us again with <a href="https://www.nacdonline.org/philadelphia/philadelphia-leadership/tom-petro/">Tom Petro</a> (Managing Partner, Capital Partners &amp; Audit Committee Member) to discuss how things have evolved in just the past 8 months.

We’ll discuss the evolving role of the audit committee, including oversight of both management and the external auditor. We’ll dive into such questions as:
<ul>
 	<li>Does the company have the requisite expertise to select, develop, deploy, and monitor genAI technologies?</li>
 	<li>Who (individual or group) in the company is responsible for oversight of the use of genAI?</li>
 	<li>Does the company have a process to track and monitor the use of genAI throughout the company, including use by third-party service providers?</li>
 	<li>What is the auditor’s understanding of the financial reporting implications of the company’s use of genAI technologies?</li>
 	<li>Does the company’s use of genAI technologies have a significant impact on the planned audit scope?</li>
 	<li>Has the auditor identified any fraud risks related to the company’s use of genAI technologies? How has the auditor addressed such risks in the audit?</li>
</ul>
<strong><em>Note</em></strong><em>: CPE available only to participants who joined the live webcast. </em>

<em>See the CAQ’s resources for more information: <a href="https://www.thecaq.org/wp-content/uploads/2024/04/caq_auditing-in-the-age-of-generative-ai__2024-04.pdf">Auditing in the Age of Generative AI</a> and  <a href="https://www.thecaq.org/ac-oversight-in-the-age-of-genai">Audit Committee Oversight in the Age of Generative AI</a>.</em>

Artificial Intelligence (AI) 101 For Audit Committees - Part II

Webinar

Event

This hour-long webcast will showcase emerging issues facing public companies and their auditors. It will feature Christine Gunia, Director of the PCAOB’s Division of Registration and Inspections, and representatives from the public company auditing profession. Panelists will discuss PCAOB inspection...

This hour-long webcast will showcase emerging issues facing public companies and their auditors. It will feature Christine Gunia, Director of the PCAOB’s Division of Registration and Inspections, and representatives from the public company auditing profession. Panelists will discuss PCAOB inspection findings and areas of focus as well as audit firm best practices.

<em><strong>Note</strong>: CPE available only to participants who joined the live webcast.</em>

Audit Insider Webinar | October 2024

Audit Committee Effectiveness: A Webinar Series | Episode 6
Welcome to Audit Committee Effectiveness: a webinar series brought to you by the Center for Audit Quality and the National Association of Corporate Directors. The series explores key takeaways and insights from...

<h4>Audit Committee Effectiveness: A Webinar Series | Episode 6</h4>
<em>Welcome to Audit Committee Effectiveness: a webinar series brought to you by the Center for Audit Quality and the National Association of Corporate Directors. The series explores key takeaways and insights from leaders in the financial reporting ecosystem alongside resources developed to aid audit committees and public company board members. Stay tuned to this page for information about topics, participants, and how to register for upcoming webinars.</em>

<img class=" wp-image-12997 alignnone" src="https://thecaq.wpenginepowered.com/wp-content/uploads/2022/11/CAQ_NACD_400x150.png" alt="CAQ NACD" width="200" height="75" />

Enterprise Risk Management (ERM) is essential for audit committee members, offering insights into identifying, assessing, and mitigating risks that impact organizational objectives. Join the CAQ, NACD and our panel of experts for a discussion on how audit committees can fulfill their oversight responsibilities related to ERM through the lens of frameworks, regulatory expectations, and best practices for effective risk oversight. Participants will learn how to enhance risk reporting, improve decision-making, and ensure alignment with strategic goals.

<em><strong>Note</strong>: CPE available only to participants who joined the live webcast.</em>

Enterprise Risk Management for Audit Committees

This hour-long webcast will showcase regulatory and practice developments of interest to public companies and their auditors. Panelists include staff from the SEC’s Division of Corporation Finance and the SEC’s Office of the Advocate for Small Business Capital Formation. Panelists...

This hour-long webcast will showcase regulatory and practice developments of interest to public companies and their auditors. Panelists include staff from the SEC’s Division of Corporation Finance and the SEC’s Office of the Advocate for Small Business Capital Formation. Panelists will discuss comments issued on SEC filings and lessons learned from the 2023 reporting cycle. Panelists will also discuss the role of the Office of the Advocate for Small Business Capital Formation, including the resources they offer small businesses and the firms that serve them.

<em><strong>Note</strong>: CPE available only to participants who joined the live webcast.</em>

Audit Insider Webinar | July 2024

Audit Committee Effectiveness: A Webinar Series | Episode 5
Welcome to Audit Committee Effectiveness: a webinar series brought to you by the Center for Audit Quality and the National Association of Corporate Directors. The series explores key takeaways and insights from...

<h4>Audit Committee Effectiveness: A Webinar Series | Episode 5</h4>
<em>Welcome to Audit Committee Effectiveness: a webinar series brought to you by the Center for Audit Quality and the National Association of Corporate Directors. The series explores key takeaways and insights from leaders in the financial reporting ecosystem alongside resources developed to aid audit committees and public company board members. Stay tuned to this page for information about topics, participants, and how to register for upcoming webinars.</em>

<img class=" wp-image-12997 alignnone" src="https://thecaq.wpenginepowered.com/wp-content/uploads/2022/11/CAQ_NACD_400x150.png" alt="CAQ NACD" width="200" height="75" />

Join us for a discussion about the <a href="https://www.thecaq.org/audit-committee-practices-report-2024">third edition of the Audit Committee Practices Report</a>, a collaboration between Deloitte’s Center for Board Effectiveness and the Center for Audit Quality. Based on survey findings, this webinar offers audit committee members and those who work with them an opportunity to hear about committee priorities, challenges, and opportunities, as well as leading practices around audit committee effectiveness.

<em><strong>Note</strong>: CPE available only to participants who joined the live webcast.</em>

2024 Audit Committee Practices Report Webinar

AI governance rose on the list of issues committees are considering
NEW YORK, Feb. 12, 2025 — As digital threats continue to mount across industries, cybersecurity remains the top priority for audit committees at public companies, outside of financial reporting and...

<p style="text-align: center;"><em>AI governance rose on the list of issues committees are considering</em></p>
NEW YORK, Feb. 12, 2025 — As digital threats continue to mount across industries, cybersecurity remains the top priority for audit committees at public companies, outside of financial reporting and internal controls, according to survey findings released in the “<a href="http://www.thecaq.org/audit-committee-practices-report">Audit Committee Practices Report: Common Threads Across Audit Committees</a>,” a joint effort between Deloitte’s Center for Board Effectiveness and the Center for Audit Quality (CAQ).

On a broader scale, enterprise risk management (ERM), critical to achieving organizational objectives and safeguarding the company’s reputation and stakeholder relationships, is ranked as the second highest priority for audit committees. Finance and internal talent remain the third-highest priority for audit committees.

The report also shows how artificial intelligence (AI) governance is growing in importance as an audit committee consideration, reflective of the rapid adoption of transformative digital technologies that have ushered in a new era of business risk.

A total of 237 respondents participated in this year’s survey, primarily on boards of U.S. (89%) public (86%) companies with $2 billion or more in market cap (72%). Directors on boards of financial services companies made up 27% of the respondents.

<strong>Cybersecurity is the chief priority for audit committees</strong>
The survey found that 93% of respondents ranked cybersecurity as one of their top three priorities, with 50% ranking it as the leading priority for the audit committee. Further, 71% report cybersecurity is on their agenda on a quarterly basis. Cybersecurity has consistently been ranked as the top priority of audit committees in each of the four years the survey has been conducted, a clear indication that complex and evolving risk will continue to be a focus for audit committees in years to come.

"Cybersecurity remains atop audit committees’ agendas because the stakes have never been higher," said Vanessa Teitelbaum, senior director, Professional Practice, Center for Audit Quality. "With the increasing sophistication of cyber threats and the potential for significant financial, operational, and reputational harm, it’s critical for audit committees to stay ahead. Their continued focus and evolving expertise are essential to protecting organizations in this heightened risk environment."

<strong>Audit committee effectiveness remains a priority</strong>
In the current economic and geopolitical environment, the corporate reporting landscape is constantly evolving. When presented with various strategies to enhance audit committee effectiveness, more than two-thirds of respondents (69%) felt meetings might be improved by implementing one or more of the following strategies:
<ul>
 	<li>Forty percent of respondents want to improve the quality of presentations during meetings. This jumped from third last year to the top area of improvement this year.</li>
 	<li>Thirty-four percent of respondents want more engagement and discussion from committee members during meetings.</li>
 	<li>While most respondents feel that they have enough time to cover agenda items, some (12%) suggested they could use more time.</li>
</ul>
“As I work with audit committees, enhancing meeting effectiveness remains a top priority. In the face of new and evolving risks, the ability to better prioritize agendas, access comprehensive and timely information, and engage in open and candid discussions are critical factors that will drive efficiency and overall effectiveness,” said Krista Parsons, Audit &amp; Assurance managing director and Governance and Audit Committee Program leader, Center for Board Effectiveness.

<strong>Enhanced focus on AI governance</strong>
The survey also found an increased emphasis on understanding the impact and usage of AI technologies throughout the organization by the C-suite and board. The number of respondents who identified AI governance as a priority grew year over year, jumping to 35% from 20% last year. A growing portion of audit committees are taking on primary oversight of AI governance (up to 20% from 14% last year). Still, oversight mostly falls with the full board (58%).

Additionally, survey results suggest that work has been done to develop governance structures for AI oversight, with fewer respondents (6%) acknowledging they “don’t know” where AI oversight falls within their organization this year versus last year (17%). Amid ongoing conversations around how organizations govern AI, the question of who should be responsible for primary oversight continues to evolve.

<a href="http://www.thecaq.org/audit-committee-practices-report">Read the report</a>.

<strong>About the Survey</strong>
The fourth edition of the “Audit Committee Practices Report,” like prior editions, is based on a survey of audit committee members. A total of 237 respondents participated in this year’s survey, primarily on boards of U.S. (89%) public (86%) companies with $2 billion or more in market cap (72%). Those on boards of financial services companies made up 27% of respondents.

<strong>About the Center for Audit Quality</strong>
The CAQ champions the public interest in the capital markets by:
<ul>
 	<li>Elevating the quality, credibility and transparency of public company audits.</li>
 	<li>Advancing critical issues affecting public company audits.</li>
 	<li>Driving innovation in assurance.</li>
 	<li>Providing a collaborative forum for capital market stakeholders to address evolving needs and challenges.</li>
</ul>
As the voice of the public company audit profession, we work to instill trust in corporate reporting and the integrity of the auditing process, ultimately empowering investors, companies, and society as a whole.

<strong>About Deloitte’s Center for Board Effectiveness</strong>
Deloitte’s Center for Board Effectiveness helps directors deliver value to the organizations they serve through a portfolio of high-quality, innovative experiences throughout their tenure as board members. Whether an individual is aspiring to board participation or has extensive board experience, the Center’s programs enable them to contribute effectively and provide focus in the areas of governance and audit, strategy, risk, innovation, compensation and succession.

<strong>About Deloitte</strong>
Deloitte provides industry-leading audit, consulting, tax and advisory services to many of the world’s most admired brands, including nearly 90% of the Fortune 500® and more than 8,500 U.S.-based private companies. At Deloitte, we strive to live our purpose of making an <a href="https://www2.deloitte.com/us/en/pages/about-deloitte/articles/purpose-at-deloitte-us.html">impact that matters</a> by creating trust and confidence in a more equitable society. We leverage our unique blend of business acumen, command of technology, and strategic technology alliances to advise our clients across industries as they <a href="https://www2.deloitte.com/us/en/pages/about-deloitte/articles/technology-consulting-engineering-advantage.html">build their future</a>. Deloitte is proud to be part of the largest global professional services network serving our clients in the markets that are most important to them. Bringing more than 175 years of service, our network of member firms spans more than 150 countries and territories. Learn how Deloitte’s approximately 460,000 people worldwide connect for impact at <a href="http://www.deloitte.com/">www.deloitte.com</a>.

###

<strong>Contact</strong>

Kerry Lee
Public Relations
Deloitte Services LP
+1 916 298 8031
kerlee@deloitte.com

Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. In the United States, Deloitte refers to one or more of the US member firms of DTTL, their related entities that operate using the “Deloitte” name in the United States and their respective affiliates. Certain services may not be available to attest clients under the rules and regulations of public accounting. Please see <a href="http://www.deloitte.com">www.deloitte.com/</a>about to learn more about our global network of member firms.

Cybersecurity, Enterprise Risk Management, and Meeting Effectiveness Are Top Priorities for Audit Committees, According to Deloitte, Center for Audit Quality Survey

Cybersecurity

Press Releases

Washington, DC (November 18, 2024) – Today, the Center for Audit Quality (CAQ) and Ideagen Audit Analytics – an Ideagen Solution, released the 11th iteration of the annual Audit Committee Transparency Barometer Report. The report, which has been conducted annually...

<strong>Washington, DC (November 18, 2024) – </strong>Today, the Center for Audit Quality (CAQ) and Ideagen Audit Analytics – an Ideagen Solution, released the 11th iteration of the annual Audit Committee Transparency Barometer Report. The report, which has been conducted annually since 2014, analyzes audit committee disclosures of companies in the S&amp;P 1500.

Given audit committees face emerging risks and new areas of oversight responsibility, investors are interested in understanding the board’s composition and expertise. This years’ Barometer shows that disclosures related to expanded disclosure areas – particularly around audit committee oversight of and expertise in cybersecurity and ESG – have increased. Tracked for the first time, this year’s report also found that most boards are disclosing a skills matrix.

“The Transparency Barometer continues to provide insights into the deliberations of audit committees and how they exercise their expanding responsibilities,” said Michael Nohrden Vice President of Strategy for Ideagen. “It serves as an important tool for boards and the public to track and compare audit committee disclosures in the S&amp;P 1500.”

However, the report identifies several disclosure areas that have plateaued. These results demonstrate a continued opportunity for audit committees to enhance their disclosures on key matters to effectively tell their story.

“We continue to hear from investors that they would like more information – not boilerplate disclosures – around audit committees’ important responsibilities and processes,” said Julie Bell Lindsay, CEO, CAQ. “While we are pleased to see that audit committees are increasingly disclosing information about new oversight areas and their expertise, we hope they will take a fresh look and consider further enhancing their disclosures to ‘tell their story’ and the important work they do.”

Some key toplines of the report include:
<ul>
 	<li>The majority of S&amp;P 500 companies (85%) and S&amp;P midcap companies (75%) disclosed the board of directors’ skills matrix.</li>
 	<li>64% of S&amp;P 500 boards disclosed the audit committee is responsible for cybersecurity oversight while 34% of S&amp;P 500 boards disclosed the audit committee is responsible for oversight of ESG information.</li>
 	<li>60% of S&amp;P 500 boards disclosed they have a cybersecurity expert compared with 51% in 2023. ESG or sustainability expertise on the boards of S&amp;P 500 companies also increased by five percentage points since 2023 to 59%.</li>
 	<li>A plateau in disclosure rates was observed across several measures, including considerations in appointing or (re) appointing the external auditor, considerations of the length of tenure, and considerations around how the audit committee evaluates audit fees in relation to audit quality.</li>
</ul>
The full report is available to read <a href="https://www.thecaq.org/audit-committee-transparency-barometer">HERE</a>.

###

<strong>About the Center for Audit Quality</strong>

The CAQ champions the public interest in the capital markets by:
<ul>
 	<li>Elevating the quality, credibility, and transparency of public company audits;</li>
 	<li>Advancing critical issues affecting public company audits;</li>
 	<li>Driving innovation in assurance; and</li>
 	<li>Providing a collaborative forum for capital market stakeholders to address evolving needs and challenges.</li>
</ul>
As the voice of the public company audit profession, we work to instill trust in corporate reporting and the integrity of the auditing process, ultimately empowering investors, companies, and society as a whole.

<strong>About <u>Ideagen </u>Audit Analytics</strong><strong> – An Ideagen Solution</strong>

<u>Ideagen </u>Audit Analytics is an independent research provider that enables the accounting, legal, and investment communities to analyze auditor market intelligence, public company disclosure trends, and risk indicators. For more information, email <a href="mailto:info@auditanalytics.com">info@auditanalytics.com</a> or call 508-476-7007.

Annual Audit Committee Disclosure Barometer Finds Increase in Disclosure of Areas of Oversight and Expertise

Washington DC, October 30, 2024 – Going into 2025, a potential recession, ongoing inflation, and geopolitical instability are just some of the top concerns of audit partners and the companies they audit, according to the Center for Audit Quality’s (CAQ)...

<strong>Washington DC, October 30, 2024</strong> – Going into 2025, a potential recession, ongoing inflation, and geopolitical instability are just some of the top concerns of audit partners and the companies they audit, according to the Center for Audit Quality’s (CAQ) most recent Audit Partner Pulse survey. The Audit Partner survey provides independent and objective perspectives on a range of topics, including economic risks and business transformation.

“Public company auditors are in every public company, of every size, in every industry, in the U.S.,” said Julie Bell Lindsay, Chief Executive Officer, CAQ. “This breadth and depth provides public company audit partners with unique insights into how America’s businesses operate.”

Below are key findings from their observations.

<strong>Partners Neutral on the Economy Despite Perceived Risks </strong>
<ul>
 	<li>A potential recession is the largest economic risk factor audit partners foresee over the next 12 months, followed by regulations and geopolitical instability.</li>
 	<li>Despite the risks, audit partners' outlook for the U.S. economy over the next 12 months is trending neutral.</li>
 	<li>Auditors are less positive about inflation, with the majority believing it will continue to impact businesses in their primary industry sector for the next six to 12 months.</li>
</ul>
<strong>Businesses are Concerned for the U.S. Election </strong>
<ul>
 	<li>According to the audit partners, most businesses are concerned about the potential impact of the U.S. election on their financial performance over the next 12 months (65%).</li>
 	<li>Despite this, most public companies are not adjusting their business strategies and do not foresee direct disruptions to their business are a result of the election.</li>
</ul>
<strong>Labor Strategies Signal Mixed News for Workers </strong>
<ul>
 	<li>Audit partners report a significant shift in labor priorities, with labor shortages dropping down considerably among their list of economic risks.</li>
 	<li>According to the audit partners, upskilling employees is the top human capital action they are observing among companies in their industry sectors (66%).</li>
 	<li>However, this is closely followed by reducing headcount (59%) and decreasing workplace flexibility (51%).</li>
</ul>
<strong>Technology Shifts in AI and Cryptocurrency:  </strong>
<ul>
 	<li>The shift in labor strategies may be influenced by public companies' use of technology. According to the audit partners, process automation (62%), customer service (52%) and predictive analysis (34%) are all areas they see companies increasing their utilization of artificial intelligence (AI).</li>
 	<li>While the audit partners reported an increase in the use of AI, organizations appear to be losing interest in cryptocurrency, with most (83%) reporting that organizations in their industry sector have no exposure to it.</li>
</ul>
Download the report, <a href="http://www.thecaq.org/audit-partner-pulse-survey"><em>Fall 2024 CAQ Audit Partner Survey</em></a>, to access the full survey results.

<strong>About the Center for Audit Quality</strong>

The CAQ champions the public interest in the capital markets by:
<ul>
 	<li>Elevating the quality, credibility, and transparency of public company audits;</li>
 	<li>Advancing critical issues affecting public company audits;</li>
 	<li>Driving innovation in assurance; and</li>
 	<li>Providing a collaborative forum for capital market stakeholders to address evolving needs and challenges.</li>
 	<li>As the voice of the public company audit profession, we work to instill trust in corporate reporting and the integrity of the auditing process, ultimately empowering investors, companies, and society as a whole.</li>
</ul>
<strong>Contact:</strong>

Brad Jacklin

Director of Communications

Bjacklin@thecaq.org

(202) 494-9560

Audit Partners’ 2025 Economic Outlook Highlights Recession, U.S. Election Concerns

Washington DC, September 26, 2024 – Kathleen Casey, Senior Advisor at Patomak Global Partners, a leading strategy, risk management, and compliance consultancy, joined the CAQ's Governing Board, effective September 26, 2024.

Casey brings decades of financial policy experience, previously serving as...

<strong>Washington DC, September 26, 2024</strong> – Kathleen Casey, Senior Advisor at Patomak Global Partners, a leading strategy, risk management, and compliance consultancy, joined the CAQ's Governing Board, effective September 26, 2024.

Casey brings decades of financial policy experience, previously serving as an SEC Commissioner from 2006 to 2011, where she acted as the SEC’s principal representative in multilateral and bilateral regulatory dialogues, the G-20 Financial Stability Board, and the International Organization of Securities Commissions (IOSCO). Casey focuses on financial markets policy, regulatory compliance and risk management, corporate governance, international regulatory developments, and enforcement in her current role.

“We’re pleased to welcome Kathy to the Board,” said Julie Bell Lindsay, Chief Executive Officer, CAQ. “Her financial policy expertise will be invaluable to the CAQ and the public company audit profession as we navigate new standards and regulations that are arising as a result of the evolving corporate reporting landscape.”

“I’m pleased to join CAQ’s Governing Board and support their important efforts to advance the CAQ’s public interest objectives of enhancing the quality, credibility and transparency of public company audits,” said Casey. “I look forward to working with the Board to address topics vital to audit quality and the future of the profession."

The CAQ’s Governing Board is comprised of a variety of leaders representing the financial reporting ecosystem, including chief executive officers from some of the largest public company audit firms, the American Institute of CPAs, as well as independent board members from stakeholder communities.

+++

<strong>About the Center for Audit Quality
</strong>The CAQ champions the public interest in the capital markets by:
<ul>
 	<li>Elevating the quality, credibility, and transparency of public company audits;</li>
 	<li>Advancing critical issues affecting public company audits;</li>
 	<li>Driving innovation in assurance; and</li>
 	<li>Providing a collaborative forum for capital market stakeholders to address evolving needs and challenges.</li>
</ul>
As the voice of the public company audit profession, we work to instill trust in corporate reporting and the integrity of the auditing process, ultimately empowering investors, companies, and society as a whole.

<strong>Contact:</strong>
Brad Jacklin
Director of Communications
Bjacklin@thecaq.org
(202)-494-9560

Patomak Global Partners’ Kathleen Casey Joins CAQ Governing Board

Washington DC, June 17, 2024 – The CAQ Governing Board elected Brian Becker, Managing Partner and CEO, RSM US LLP (RSM), as the new Vice Chairman of the Governing Board, effective June 14, 2024.

Becker oversees the firm’s strategy and operations...

<strong>Washington DC</strong>, <strong>June 17, 2024</strong> – The CAQ Governing Board elected Brian Becker, Managing Partner and CEO, RSM US LLP (RSM), as the new Vice Chairman of the Governing Board, effective June 14, 2024.

Becker oversees the firm’s strategy and operations across four countries—the United States, Canada, El Salvador and India. Becker is driving RSM to become a digital firm and is committed to advancing the firm’s inclusive culture, as well as to continuing its longstanding history of stewardship.

“With his extensive experience and long-standing dedication to the profession, Brian will be essential to the CAQ as we work to instill trust in corporate reporting and the integrity of the auditing process,” said Julie Bell Lindsay, Chief Executive Officer, Center for Audit Quality.

“In this time of accelerating change for the auditing profession, the CAQ’s mission of enhancing trust and transparency is more important than ever,” said Becker. “I look forward to continuing to serve on the Board in the role of Vice Chair as we address the challenges and opportunities that lie ahead.”

Becker succeeds Wayne Berson, Chief Executive Officer, BDO USA and Chairman, BDO International. “I also want to extend our gratitude to Wayne for his time and energy as Vice Chair of our Governing Board since 2019. With his vision and leadership, Wayne has been an essential driver of our goals and commitment to strengthening the work of public company auditors,” said Lindsay.

The CAQ’s Governing Board is comprised of a variety of leaders representing the financial reporting ecosystem, including chief executive officers from some of the largest public company audit firms, the American Institute of CPAs, as well as independent board members from investor, board member and issuer communities.

<strong>About the Center for Audit Quality
</strong>
The CAQ champions the public interest in the capital markets by:
<ul>
 	<li>Elevating the quality, credibility, and transparency of public company audits;</li>
 	<li>Advancing critical issues affecting public company audits;</li>
 	<li>Driving innovation in assurance; and</li>
 	<li>Providing a collaborative forum for capital market stakeholders to address evolving needs and challenges.</li>
</ul>
As the voice of the public company audit profession, we work to instill trust in corporate reporting and the integrity of the auditing process, ultimately empowering investors, companies, and society as a whole.

<strong>Contact:</strong>
Brad Jacklin
Director of Communications
Bjacklin@thecaq.org
(202)-494-9560

RSM CEO Brian Becker Elected as New Vice Chair of CAQ Governing Board

Preparers/Issuers

This report highlights top priorities identified by surveyed audit committee members as the regulatory environment grows in complexity. 
Download PDF We’re excited to publish the fourth edition of the Audit Committee Practices Report, a joint effort between Deloitte’s Center for...

Audit Committee Practices Report

Publications

The CAQ analyzed S&amp;P 500 companies’ 10-Ks to understand their SEC filing disclosures regarding climate-related information, greenhouse gas emissions, and net-zero and carbon neutral commitments. 
 The CAQ analyzed S&amp;P 500 companies’ Form 10-Ks to understand the extent of climate-related...

Analysis of Climate-Related Information in S&P 500 Companies’ 10-Ks

The CAQ analyzed S&amp;P 500 companies’ Form 10-Ks to understand the extent of AI-related disclosures in those SEC filings. This was our first year performing this analysis over AI-related information. 
The CAQ analyzed S&amp;P 500 companies’ Form 10-Ks to understand...

Analysis of AI-Related Information in S&P 500 Companies’ 10-Ks

As part of the Center for Audit Quality’s (CAQ) ongoing effort to keep members and stakeholders informed on significant public policy and accounting matters, we are pleased to offer the Public Policy and Technical Alert (PPTA). Each month, the PPTA...

<img class="aligncenter wp-image-13848" src="https://thecaq.wpenginepowered.com/wp-content/uploads/2023/06/2023_06_PPTA_HEADER.png" alt="Public Policy &amp; Technical Alert" width="600" height="150" />

As part of the Center for Audit Quality’s (CAQ) ongoing effort to keep members and stakeholders informed on significant public policy and accounting matters, we are pleased to offer the Public Policy and Technical Alert (PPTA). Each month, the PPTA highlights and examines the regulatory, standard-setting, legislative, and broader financial reporting developments impacting the public company audit profession. Please note that the PPTA is intended as general information and should not be relied upon as being definitive or all-inclusive. The CAQ encourages member firms to refer to the rules, standards, guidance, and other resources in their entirety at the hyperlinks provided below. All entities should carefully evaluate which requirements apply to their respective organizations.
<h2>In This Issue</h2>
<img class="alignnone wp-image-13854" src="https://www.thecaq.org/wp-content/uploads/2023/06/PPTA_Section-Header_SEC.png" alt="SEC" width="350" height="44" />
<h3><strong>SEC Announces Chief Accountant Paul Munter to Retire from Federal Service</strong></h3>
The SEC <a href="https://www.sec.gov/newsroom/press-releases/2025-9">announced</a> that Chief Accountant Paul Munter plans to retire from federal service effective Jan. 24, 2025. Munter joined the agency in 2019, was named Acting Chief Accountant in 2021, and was appointed Chief Accountant in January 2023. As Chief Accountant, Munter led the Commission's oversight of the FASB and  the PCAOB.
<h3><strong>Mark T. Uyeda Named Acting Chairman of the SEC</strong></h3>
The SEC <a href="https://www.sec.gov/newsroom/press-releases/2025-29">announced</a> that President Donald J. Trump has designated Mark T. Uyeda as Acting Chairman of the agency. Acting Chairman Uyeda was first sworn into office as a Commissioner on June 30, 2022, after being confirmed by the U.S. Senate. He was subsequently re-nominated and confirmed for a five-year term expiring in 2028.
<h3><strong>Acting Chairman Mark T. Uyeda Names Acting Senior Staff</strong></h3>
The SEC <a href="https://www.sec.gov/newsroom/press-releases/2025-31">announced</a> Acting Chairman Mark T. Uyeda's selections for several senior roles in acting capacities across the Commission to fill vacancies created by recent departures. The SEC senior staff selected by Acting Chairman Uyeda, with the concurrence of the Commission, include:
<ul>
 	<li>Jeffrey Finnell, Acting General Counsel</li>
 	<li>Robert Fisher, Acting Director of the Division of Economic and Risk Analysis</li>
 	<li>Kathleen Hutchinson, Acting Director of the Office of International Affairs</li>
 	<li>Samuel Waldon, Acting Director of the Division of Enforcement</li>
 	<li>Ryan Wolfe, Acting Chief Accountant (effective Jan. 25, 2025)</li>
</ul>
<h3><strong>SEC Updates Questions and Answers for Compliance and Disclosure Interpretations (CD&amp;Is) of Proxy Rules and Schedule 14A/14C</strong></h3>
The SEC <a href="https://www.sec.gov/rules-regulations/staff-guidance/compliance-disclosure-interpretations/proxy-rules-schedules-14a14c">updated</a> the following CD&amp;Is regarding Proxy Rules and Schedule 14A: Section 126. Rule 14a-6:
<ul>
 	<li>Revised Question 126.06</li>
 	<li>Revised Question 126.07</li>
 	<li>New Question 126.08</li>
 	<li>New Question 126.09</li>
 	<li>New Question 126.10</li>
</ul>
<h3><strong>SEC Issues Staff Accounting Bulletin (SAB) No. 122</strong></h3>
The SEC <a href="https://www.sec.gov/rules-regulations/staff-guidance/staff-accounting-bulletins/staff-accounting-bulletin-122">issued</a> SAB 122, which rescinds the interpretive guidance included in Section FF of Topic 5 in the Staff Accounting Bulletin Series entitled <em>Accounting for Obligations to Safeguard Crypto-Assets an Entity Holds for its Platform Users </em>(Topic 5.FF). Upon application of Topic 5.FF, an entity that has an obligation to safeguard crypto-assets for others should determine whether to recognize a liability related to the risk of loss under such an obligation, and if so, the measurement of such a liability, by applying the recognition and measurement requirements for liabilities arising from contingencies in Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) Subtopic 450-20, <em>Loss Contingencies, </em>or International Accounting Standard (IAS) 37, <em>Provisions, Contingent Liabilities and Contingent Assets</em>, under U.S. generally accepted accounting principles and IFRS Accounting Standards, respectively.

<img class="alignnone wp-image-13853" src="https://www.thecaq.org/wp-content/uploads/2023/06/PPTA_Section-Header_PCAOB.png" alt="PCAOB" width="350" height="44" />
<h3><strong>A New Edition of the PCAOB's <em>Audit Focus</em> Series Provides PCAOB Staff Insights for Auditors Regarding Journal Entries</strong></h3>
The PCAOB <a href="https://pcaobus.org/resources/staff-publications/audit-focus-journal-entries">posted</a> <em>Audit Focus: Journal Entries</em>, a new edition of its <em>Audit Focus</em> series. This edition of <em>Audit Focus</em> highlights key reminders for auditors from the PCAOB standards related to testing of journal entries, provides the staff's perspective on common deficiencies made by auditors, and shares good practices that PCAOB staff has observed.
<h3><strong>PCAOB Launches New Resource Page for Smaller Audit Firms</strong></h3>
The PCAOB <a href="https://pcaobus.org/news-events/news-releases/news-release-detail/pcaob-launches-new-resource-page-for-smaller-audit-firms">launched</a> a new online resource page: <em>Information for Smaller Firms</em>. Recently, the PCAOB has enhanced its focus on smaller firms with a range of initiatives. Building on previous efforts, the smaller firm resource page includes links to <em>Audit Focus</em> publications and videos, recordings of recent presentations from PCAOB forums for auditors of smaller businesses and broker-dealers, and a signup form for a new PCAOB Communications to Small Audit Firm Practitioners mailing list.
<h3><strong>PCAOB Posts a Staff Presentation Video Designed to Help Firms and Auditors Understand a Firm's Risk Assessment Process Under the PCAOB's New Quality Control Standard (QC 1000)</strong></h3>
The PCAOB <a href="https://pcaobus.org/oversight/standards/implementation-resources-PCAOB-standards-rules/quality-control#resources">posted</a> a staff presentation video designed to help firms and auditors understand a firm's risk assessment process under the PCAOB's new quality control standard.

<img class="alignnone wp-image-13851" src="https://www.thecaq.org/wp-content/uploads/2023/06/PPTA_Section-Header_FASB.png" alt="FASB" width="400" height="50" />

<strong>FASB Stakeholders Invited to Share Their Views on Future Agenda Priorities</strong>
The FASB <a href="https://fasb.org/news-and-meetings/in-the-news/fasbb-stakeholders-invited-to-share-their-views-on-future-agenda-priorities-420472">published</a> an Invitation to Comment (ITC) that gives stakeholders the opportunity to provide feedback on its future standard-setting agenda. Stakeholders are asked to review and provide comment on the ITC by June 30, 2025.
<h3><strong>FASB Clarifies Interim Effective Date for New Disaggregation of Income Statement Expenses Standard for Non-Calendar Year-End Entities</strong></h3>
The FASB <a href="https://fasb.org/news-and-meetings/in-the-news/fasb-clarifies-interim-effective-date-for-new-disaggregation-of-income-statement-expenses-standard-for-non-calendar-year-end-entities-420531">published</a> an Accounting Standards Update (ASU) that clarifies for non-calendar year-end entities the interim effective date of Accounting Standards Update No. 2024-03, <em>Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses</em>. Public business entities are required to adopt the guidance in Update 2024-03 in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption of Update 2024-03 is permitted.
<h3><strong>FASB Seeks Public Comment on Proposed Codification Improvements</strong></h3>
The FASB <a href="https://fasb.org/news-and-meetings/in-the-news/fasb-seeks-public-comment-on-proposed-codification-improvements-420789">published</a> a proposed ASU focused on targeted improvements to the FASB Accounting Standards Codification. The amendments in this proposed ASU address 34 issues that would affect a wide variety of Topics in the Codification and would apply to all reporting entities within the scope of the affected accounting guidance. Stakeholders are encouraged to review and provide input on the proposed ASU by April 22, 2025.

<img class="alignnone wp-image-13849" src="https://www.thecaq.org/wp-content/uploads/2023/06/PPTA_Section-Header_AICPA.png" alt="AICPA" width="400" height="50" />
<h3><strong>AICPA Updates Digital Assets Practice Aid</strong></h3>
The AICPA <a href="https://www.aicpa-cima.com/news/article/aicpa-significantly-updates-digital-assets-practice-aid">announced</a> it updated its practice aid, <em>Accounting for and Auditing of Digital Assets</em>, in response to the FASB ASU No. 2023-08, <em>Intangibles - Goodwill and Other - Crypto Assets (Subtopic 350-60): Accounting for and Disclosure Of Crypto Assets</em>. The practice aid offers a new definition for digital assets, new and amended accounting questions, and the introduction of new terms.
<h3><strong>Professional Ethics Executive Committee (PEEC) Open Meeting Agenda: February 4-5, 2025</strong></h3>
The AICPA <a href="https://www.aicpa-cima.com/news/download/peec-open-meeting-agenda-february-4-2025">announced</a> PEEC will be holding its first quarter 2025 open meeting on February 4-5.
<h3><strong>PEEC Open Meeting Minutes: November 12-13, 2024</strong></h3>
The AICPA <a href="https://www.aicpa-cima.com/news/download/peec-open-meeting-minutes-november-12-13-2024">posted</a> the minutes of the November 2024 open meeting of PEEC.

<img class="wp-image-13852 alignnone" src="https://thecaq.wpenginepowered.com/wp-content/uploads/2023/06/PPTA_Section-Header_International.png" alt="International" width="400" height="50" />
<h3><strong>The International Ethics Standards Board for Accountants (IESBA) Launches Standard-Setting Project on Accounting Firm Culture and Governance</strong></h3>
The IESBA <a href="https://www.ethicsboard.org/news-events/2025-01/iesba-launches-standard-setting-project-accounting-firm-culture-and-governance">launched</a> a standard-setting project on accounting firm culture and governance. The standard-setting project aims to develop a principles-based culture and governance framework for accounting firms that promotes, supports, and reinforces a high standard of ethical behavior across all their professional services.
<h3><strong>International Auditing and Assurance Standards Board (IAASB) and IESBA Unveil New Standards and Guidance to Strengthen Sustainability Reporting and Assurance</strong></h3>
The IAASB and the IESBA <a href="https://www.iaasb.org/news-events/2025-01/iaasb-iesba-unveil-new-standards-and-guidance-strengthen-sustainability-reporting-and-assurance">announced</a> the launch of an integrated effort to support effective implementation of their landmark standards aimed at advancing trust and transparency in sustainability reporting and assurance. In jurisdictions adopting the standards, both IAASB's International Standard on Sustainability Assurance 5000 (ISSA 5000) and IESBA's International Ethics Standards for Sustainability Assurance (including International Independence Standards (IESSA) become effective for periods starting on or after December 15, 2026, with early adoption permitted and encouraged.
<h3><strong>January 2025 </strong><strong>International Accounting Standards Board (</strong><strong>IASB) <em>Update</em> Now Available</strong></h3>
The IFRS Foundation <a href="https://www.ifrs.org/news-and-events/updates/iasb/2025/iasb-update-january-2025/">announced</a> that the IASB <em>Update</em>, summarizing the January 2025 IASB meeting, is now available.

<img class="wp-image-13850 alignnone" src="https://thecaq.wpenginepowered.com/wp-content/uploads/2023/06/PPTA_Section-Header_CAQ.png" alt="CAQ" width="400" height="50" />
<h3><strong>Smaller Firm Task Force (</strong><strong>SFTF</strong><strong>)</strong><strong> Comment Letter</strong><strong> to the</strong><strong> SEC on the </strong><strong>PCAOB’s Firm Reporting and Firm and Engagement Metrics Rules</strong></h3>
The CAQ <a href="https://www.thecaq.org/sftf-comment-letter-sec-pcaob-notice-of-filing-of-proposed-rules-on-fem-and-fr">posted</a> a comment letter that represents the views of the SFTF regarding the totality of the PCAOB's standard setting activities, including their recently adopted Firm and Engagement Metrics and Firm Reporting rules.
<h3><strong>Sustainability Reporting and Assurance: Key Considerations for Legislators and Regulators</strong></h3>
The CAQ <a href="https://www.thecaq.org/sustainability-reporting-and-assurance">posted</a> a publication on sustainability reporting and assurance that explores important considerations for legislators and regulators as they respond to the evolving needs of the market by contemplating laws and regulations requiring companies to report sustainability information.
<h3><strong>2025 Profession Outlook: Auditors Will Continue to Provide Stability and Dependability During Changing Times</strong></h3>
The CAQ <a href="https://www.thecaq.org/aia-2025-profession-outlook">published </a>a blog post written by Julie Bell Lindsay, Chief Executive Officer of the CAQ, that shares her outlook for the public company audit profession heading into 2025, including the regulatory landscape, the role for the audit profession in emerging technology, solutions for tackling the profession's talent challenge, and the value of assurance in 2025 and beyond.

<hr />

The Center for Audit Quality is a nonpartisan public policy organization serving as the voice of U.S. public company auditors and matters related to audits of public companies. The CAQ promotes high quality performance by U.S. public company auditors; convenes capital market stakeholders to advance the discussion of critical issues affecting audit quality, U.S. public company reporting, and investor trust in the capital markets; and using independent research and analyses, champions policies and standards that bolster and support the effectiveness and responsiveness of U.S. public company auditors and audits to dynamic market conditions. Based in Washington, DC, the CAQ is affiliated with the American Institute of CPAs. For more information, visit <a href="https://www.thecaq.org/">www.thecaq.org</a>.

The CAQ Public Policy and Technical Alert (PPTA) is intended as general information and should not be relied upon as being definitive or all-inclusive. As with all other CAQ resources, this is not authoritative and readers are urged to refer to relevant rules and standards. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The CAQ makes no representations, warranties, or guarantees about, and assumes no responsibility for, the content or application of the material contained herein and expressly disclaims all liability for any damages arising out of the use of, reference to, or reliance on such material. This publication does not represent an official position of the CAQ, its board, or its members.

<em>Questions and comments about the Public Policy &amp; Technical Alert can be addressed to <a href="https://www.thecaq.org/about-us/our-people/donnie-heinerichs-cpa">Donnie Heinerichs</a>, Manager, ESG Initiatives (</em><a href="mailto:vteitelbaum@thecaq.org"><em>dheinerichs@thecaq.org</em></a><em>) or <a href="https://www.thecaq.org/about-us/our-people/annette-schumacher-cpa-cgma">Annette Schumacher</a>, Senior Director, Professional Practice (</em><a href="mailto:ashumacher@thecaq.org"><em>ashumacher@thecaq.org</em></a><em>).  </em>

Public Policy and Technical Alert | January 2025

Newsletter

PPTA

As part of the CAQ’s efforts to engage a broad array of stakeholders of company-prepared information and serve as a trusted voice for the audit profession, KRC Research is conducting surveys throughout the year to inform the CAQ team on...

As part of the CAQ’s efforts to engage a broad array of stakeholders of company-prepared information and serve as a trusted voice for the audit profession, KRC Research is conducting surveys throughout the year to inform the CAQ team on topics of interest to institutional investors.

The survey research was conducted online from November 4-22, 2024 among 309 Institutional Investors in the US. In order to qualify for the study, respondents were screened to ensure:
<ul>
 	<li>Employed as a professional investor with more than five years of experience</li>
 	<li>At companies with a minimum of $500M in assets under management</li>
 	<li>Have appropriate job titles in investment banking, commercial banking, insurance, or other management firms</li>
 	<li>Serve at the Director level or higher</li>
 	<li>Closely follow information about the audit process and regulations related to public company financial statements</li>
</ul>
&nbsp;

<a class="button" href="https://thecaq.wpenginepowered.com/wp-content/uploads/2025/02/caq_investor-survey-q4_2025-02.pdf">Read the survey</a>

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