Symbol

Global Style Sheet

Video

HeroBlock

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

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

NewsTicker

Text

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. 

Lucy Wang is Director, Anti-Fraud Initiatives at the Center for Audit Quality. In this role since 2019, Wang serves as a subject matter expert on issues related to fraud deterrence and detection. Wang is responsible for leading technical and policy-oriented projects while working closely with representatives from the Anti-Fraud Collaboration, task forces, and the broader profession. Wang manages the development of thought leadership, reports, and other resources that address current financial reporting fraud issues.

Before joining the CAQ, Wang served as Manager at PwC’s Forensic Services practice based in Washington, DC and Shanghai, China, where she assisted Fortune 500 companies with their global compliance programs, cross-border M&amp;A transactions, large scale risk assessments, regulatory investigations, and litigation support. Wang executed complex investigations involving cases such as financial statement fraud, misappropriation of assets, bribery, and corruption. Wang also led numerous anti-corruption and fraud risk assessments globally, including in Asia Pacific, Africa, and Europe.

Wang is a Certified Fraud Examiner, and she holds a BS in finance and accounting from New York University’s Leonard N. Stern School of Business.

Lucy Wang, CFE

Companies that swiftly transitioned to remote work during the pandemic are now exploring ways to bring employees back to the office full-time, implement hybrid models, or establish long-term remote work policies. These changes present new challenges in maintaining an ethical...

Companies that swiftly transitioned to remote work during the pandemic are now exploring ways to bring employees back to the office full-time, implement hybrid models, or establish long-term remote work policies. These changes present new challenges in maintaining an ethical organizational culture to proactively deter and detect fraud.

As a partner of the <a href="https://antifraudcollaboration.org/">Anti-Fraud Collaboration (AFC),</a> the Center for Audit Quality (CAQ) advances discussions among all members of the financial reporting ecosystem about ways to strengthen fraud prevention, and corporate culture is a key pillar.

The AFC’s latest resource, <a href="https://antifraudcollaboration.org/the-impact-of-a-changing-work-environment-on-corporate-culture/"><em>The Impact of a Changing Work Environment on Corporate Culture</em></a>, offers valuable insights and actionable guidance for organizations looking to strengthen their culture and anti-fraud efforts while navigating an evolving work environment.

Keep reading for my key takeaways from the report.
<h3><strong>Adapting Corporate Culture in a Changing Work Environment</strong></h3>
An organization’s culture evolves alongside workplace expectations and business practices. As organizations navigate shifts in the work environment, many employees—including managers—may feel disconnected or uncertain about their roles. According to human resources and culture subject matter experts, employees are increasingly looking for flexibility, autonomy, and empathy in the workplace. It is critical for leaders to balance these expectations while preserving a strong corporate culture.

The prolonged period of remote work, combined with a new generation entering the workforce, has changed how employees perceive corporate culture. In a <a href="https://www.mckinsey.com/mgi/our-research/empty-spaces-and-hybrid-places">McKinsey &amp; Company study</a>, 10% of workers worldwide said they would likely quit their jobs if they were required to work at the office every day. They also agreed that they would forgo more than 20% of their compensation to work the right number of days at home.

Companies have faced pushbacks in response to return-to-office mandates, in some cases leading to increased turnover, lower job satisfaction, and other potential unforeseen consequences. It is important to recognize the considerable impact of demographics on employees’ attitudes and experiences with regards to remote, hybrid, and in-person work, and remain flexible when making workplace decisions for a broad employee base.

[custom_quote text="10% of workers worldwide said they would likely quit their jobs if they were required to work at the office every day."]
<h3><strong>Reinforcing Ethical Culture in a Hybrid Work Environment</strong></h3>
A strong ethical culture must be reinforced through deliberate actions, especially in a changing workplace.

A few of these strategies include revisiting the hiring process regularly to ensure it aligns with the work environment, assigning a peer mentor to help new employees navigate the company culture and foster connections virtually, and emphasizing achievements and employees’ positive impact on the organization, while avoiding micromanaging employees’ work.

Additionally, organizations should readily and continually assess the unique impact new working models have on their governance, risk management, and control processes to ensure that cultural integrity remains intact.

[custom_quote text="Assign a peer mentor to help new employees navigate the company culture and foster connections virtually."]
<h3><strong>How Changes in Work Environment Impact Fraud Risks</strong></h3>
As work environments continue to evolve, the risk of fraud can increase in unexpected ways. Employees who feel disconnected from their organizations while working remotely may be more likely to rationalize fraudulent behavior, and they may find it easier to perpetuate fraud or engage in misconduct without being caught.

According to the <a href="https://legacy.acfe.com/report-to-the-nations/2024/">Association of Certified Fraud Examiners (ACFE)</a>, the most common behavioral red flag for fraud is an employee living beyond their means. In a traditional office setting, coworkers and managers may notice signs such as expensive purchases or lavish vacations. In a remote environment, these warning signals are often more difficult to detect. The absence of casual, spontaneous in-person contact to build relationships among employees may also weaken employees' sense of connection to their company and its ethical culture.

Strengthening accountability, reinforcing ethical values, and fostering a culture of integrity—whether in-person or virtual—will be critical to identify and mitigate fraud risks in the modern workplace.

[custom_quote text="Employees who feel disconnected from their organizations while working remotely may be more likely to rationalize fraudulent behavior."]
<h3><strong>Fraud Prevention Through Culture and Risk Management</strong></h3>
An ethical corporate culture can mitigate the pressures that lead to fraud through strong risk management practices and appropriate incentives. However, in a time of constant disruption and changing work environments, management must regularly assess emerging risks and adjust their monitoring strategies accordingly.

Organizations should consider a variety of tools to enhance their culture and deter fraud and misconduct, including:
<ul>
 	<li>Robust internal controls, policies, and processes</li>
 	<li>Applying the elements of the fraud triangle in risk assessment</li>
 	<li>Employee surveys and culture metrics to measure sentiment</li>
 	<li>Leveraging technology for fraud detection</li>
 	<li>Encouraging teamwork and cross-functional collaboration</li>
 	<li>Setting a strong tone at the top</li>
 	<li>Implementing whistleblower and ethics hotlines</li>
 	<li>Effective change management strategies</li>
</ul>
There is not a one-size-fits-all approach to establishing a strong ethical culture, particularly in today’s eclectic work environment. However, by leveraging these tools and techniques, organizations can create a solid foundation that fosters, reinforces, and enhances ethical behavior across the workforce.

A strong ethical culture not only deters fraud but also strengthens trust among different stakeholder groups. By embracing flexibility, reinforcing core values, and implementing effective fraud prevention strategies, organizations can navigate the complexities of today’s business and regulatory landscape while upholding the highest standards of integrity.

As the fraud risk landscape continues to evolve, I encourage your organization to review how its risk management practices and incentives can be enhanced to foster a strong culture. Make sure to follow the <a href="https://antifraudcollaboration.org/">AFC</a> on <a href="https://twitter.com/antifraudcollab">X</a> and <a href="https://www.linkedin.com/company/antifraudcollaboration/">LinkedIn</a> to stay up to date on the latest resources to deter and detect fraud.

[custom_quote text="There is not a one-size-fits-all approach to establishing a strong ethical culture."]

The Future of Work: Enhancing Corporate Culture to Deter and Detect Fraud

Anti-Fraud

Blog Post

Vanessa Teitelbaum, CPA, is Senior Director, Professional Practice at the Center for Audit Quality. She joined the CAQ in 2016 and advocates for stakeholders in the audits of public companies.

As an in-house expert and resource on auditing and accounting practice issues, Vanessa leads task forces comprised of audit partners and technical experts from the public company audit profession related to proposed standards and other current issues facing the profession. Projects have included development of the CAQ’s <em>Audit Quality Disclosure Framework</em>, <em>Preparing for the New Credit Losses Standard: A Tool for Audit Committees</em>, and the <em>External Auditor Assessment Tool</em>, among other publications. Vanessa has facilitated responses to proposed standards and regulations related to quality management, supervision of other auditors, quarterly reporting, the accelerated filer definition, and independence.

Before joining the CAQ, Vanessa served as an audit senior manager at PricewaterhouseCoopers and Dixon Hughes Goodman, leading audit teams of both large and midsize companies in a variety of industries, including technology, manufacturing, and financial services. Vanessa has over 15 years of audit experience, specialized in SEC financial reporting, technical accounting, and internal control matters.

Vanessa is a Certified Public Accountant in Maryland. She holds a bachelor of arts in Asian studies from Williams College and a master of business administration in accounting and finance from New York University Stern School of Business.

Vanessa Teitelbaum, CPA

In an increasingly complex regulatory environment, and as organizations address new and ongoing challenges, the responsibilities of audit committees continue to grow.

These growing responsibilities are the focus of the  2025 Audit Committee Practices Report, a collaboration between the Center for...

In an increasingly complex regulatory environment, and as organizations address new and ongoing challenges, the responsibilities of audit committees continue to grow.

These growing responsibilities are the focus of the  <a href="https://www.thecaq.org/audit-committee-practices-report">2025<em> Audit Committee Practices Report</em></a><em>,</em> a collaboration between the Center for Audit Quality (CAQ) and Deloitte’s Center for Board Effectiveness, which sheds light on the latest trends, priorities, challenges, and practices to promote audit committee effectiveness according to survey results. Below are the main takeaways from this year’s report.
<h3><strong>What are the top priorities for audit committees?</strong></h3>
The demographics of survey respondents remain consistent year over year: Of the 237 participants, 89 percent were directors on US boards, with 86 percent serving on the boards of public companies and 72 percent serving on the boards of companies with more than $2 billion in market capitalization. Additionally, 27 percent serve on the boards of financial services companies.

The survey found that - beyond oversight of financial statements and internal control over financial reporting - the three top priority areas for audit committee chairs and members remain consistent with last year’s report: cybersecurity, enterprise risk management (ERM), and finance and internal audit talent.

[custom_quote text="The three top priority areas for audit committee chairs and members: cybersecurity, ERM, and finance and internal audit talent."]
<h3><strong>A Spotlight on Cybersecurity</strong></h3>
Ninety-three percent of survey respondents ranked cybersecurity as one of their top three priorities, with 50 percent of respondents ranking it as their number one audit committee priority for the year ahead. Furthermore, 71 percent of respondents reported that cybersecurity is on their committee agenda every quarter.

These findings are consistent with insights from the CAQ and Ideagen Audit Analytics <a href="https://www.thecaq.org/audit-committee-transparency-barometer"><em>Audit Committee Transparency Barometer 2024</em></a>. The Barometer report finds that 64 percent of S&amp;P 500 companies indicated their audit committees are responsible for oversight of cybersecurity risk, up from 59 percent the previous year. Furthermore, with the US Securities and Exchange Commission’s <a href="https://www.sec.gov/files/rules/final/2023/33-11216.pdf">Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure Rule</a> in effect, these findings also reflect the regulatory landscape. The CAQ’s <a href="http://thecaq.org/caq_audit-partner-pulse-survey-2024_2024-10"><em>2024 Audit Partner Pulse Survey</em></a> found that 47 percent of audit partners expected to see companies in their primary industry sector voluntarily increase or enhance cybersecurity disclosures over the next 12 months.

Given that cybersecurity is a top priority for audit committees, it is important for audit committees to have the right skill set for effective oversight. As such, nearly one-third (31%) of 2025 <em>Audit Committee Practices Report</em> respondents pointed to cybersecurity expertise as the top skill most likely to enhance the audit committee’s effectiveness. Half of respondents (50%) ranked cybersecurity expertise among the top three skills most likely to enhance the audit committee's effectiveness. Interestingly, not as many respondents from financial services companies (44%) ranked cybersecurity in their top three skills, indicating that these companies may have made an effort to add this skill to their boards in recent years.

Given the prevalence of cybersecurity threats, it is critical that the board or audit committee regularly engage with the chief information security officer (CISO) or equivalent leader. Similar to engaging with many C-suite executives, the audit committee chair should have a strong relationship with the CISO beyond committee meetings.

[custom_quote text="Ninety-three percent of survey respondents ranked cybersecurity as one of their top three priorities."]
<h3><strong>Why is ERM important?</strong></h3>
<strong> </strong>ERM is also a top priority for audit committees. This is consistent with the prior year’s 2024 <em>Audit Committee Practices Report</em> results as having effective ERM is crucial for achieving organizational objectives, safeguarding the company’s reputation and stakeholder relationships, and ensuring long-term success.

According to the 2025 <em>Audit Committee Practices Report</em>, 52 percent of survey respondents noted that the audit committee is responsible for the oversight of ERM, while 28 percent cited the full board and 19 percent cited the risk committee as responsible for this oversight. Interestingly, financial services companies were less likely to assign audit committees the primary role of overseeing ERM (21%) when compared to companies in other industries (63%). Instead, 48 percent of financial services respondents delegate this responsibility to a dedicated risk committee, with only 8 percent of nonfinancial services companies using a risk committee for oversight of ERM.

Eight percent of respondents identified ERM as the top skill, and 27 percent included it in their top three skills, when asked to rank the skills needed to enhance audit committee effectiveness over the next 12 months. Nearly half of all respondents reported that ERM is on the audit committee’s quarterly meeting agenda.

As boards and committee members continue to prioritize ERM, it is important to remain aware of emerging risks and ask management about how they are being considered in the ERM program. If they have not done so already, boards should request tools from management to help them assess risk.

From our experience, we know there are benefits to having directors with different backgrounds. In this case, the varied perspectives of directors can enhance the identification of risk and enable the board to perform its oversight responsibilities and support management.

[custom_quote text="Eight percent of respondents identified ERM as the top skill, and 27 percent included it in their top three skills."]
<h3><strong>The Importance of Finance and Internal Audit Talent</strong></h3>
In the 2025 <em>Audit Committee Practices Report</em>, talent expertise nudged out other top priorities, such as compliance and finance transformation, to round out the top three skills to enhance committee effectiveness.

Impressively, 92 percent of respondents indicated that finance and internal audit talent is the primary responsibility of the audit committee. This topic is on the audit committee agenda quarterly for 38 percent of respondents, semiannually for 18 percent of respondents, annually for 23 percent of respondents, and as needed for 21 percent of respondents.

According to the survey, 89 percent of respondents agreed that internal audit has a high level of understanding of business operations and 82 percent agreed that there is an opportunity to extract more value from internal audit.
<p style="text-align: center;">•••</p>
<p style="text-align: center;"><em>“As audit committee chair, build a strong relationship with your [chief financial officer] and chief audit executive, particularly if they are new to their roles. Serve as a mentor and ally, demonstrating your commitment to their success. Establishing trust and open communication during stable times creates a foundation that will prove invaluable when there are challenges. Moreover, meaningful mentoring relationships not only boost effectiveness but are personally rewarding as well.”</em></p>

<h5 style="text-align: center;"><em>—Sandra Helton, audit committee chair, OptiNose</em></h5>
<p style="text-align: center;">•••</p>
To this end, audit committees should continue to cultivate strong relationships with both the finance and internal audit leaders, in addition to focusing on succession planning for key team members. It is also important to consider the appropriateness of resource allocation to finance and internal audit functions so that appropriate investments can be made in long-term system and process improvements to support the company.

[custom_quote text="92 percent of respondents indicated that finance and internal audit talent is the primary responsibility of the audit committee."]
<h3><strong>Audit Committee Practices and Effectiveness: Key Insights</strong></h3>
It is equally important for audit committees to benchmark against best practices to measure their effectiveness. This year, respondents were asked to measure audit committee effectiveness during meetings and only 31 percent of respondents were satisfied with their performance, compared to 35 percent in last year’s survey, according to the 2025 <em>Audit Committee Practices Report</em>.

When asked how audit committees can improve their effectiveness, the top three responses were:
<ul>
 	<li>Improve the quality of presentations during meetings.</li>
 	<li>Increase discussion during meetings.</li>
 	<li>Improve the quality of pre-read materials.</li>
</ul>
These three opportunities are interconnected as the key point we often hear about is a desire to avoid lengthy presentations. For audit committees, we recommend creating effective executive summaries of presentations with details in appendices. This allows for additional time for questions and discussion, rather than presentations taking up most of the meeting.
<h3><strong>The Role of the Independent Auditor</strong></h3>
The 2025 <em>Audit Committee Practices Report</em> reveals that the most important considerations when assessing the quality of a company’s independent auditor include:
<ul>
 	<li>previous experience working with the auditor (53%),</li>
 	<li>the audit firm’s overall reputation (53%), and</li>
 	<li>audit quality indicators (53%).</li>
</ul>
Audit committees looking to enhance the effectiveness and oversight of their independent auditors should understand from their audit engagement partners the planned risk-based audit approach, if there is adequate engagement staffing and continuity, and if audit milestones are being achieved as planned. Furthermore, audit committees should tell their stories in their proxy statements regarding their oversight of the independent auditor.

<hr />

The views expressed in this article are the author's own and do not represent the perspective of NACD.

<em>CAQ is a NACD partner, providing directors with critical and timely information, and perspectives. CAQ is a financial supporter of the NACD.</em>

<strong><em>Vanessa Teitelbaum, CPA, is senior director on the Professional Practice team at the Center for Audit Quality. She joined the CAQ in 2016 and advocates for stakeholders in the audits of public companies.</em></strong>

<hr />

<span data-teams="true"><i>This article first appeared in </i><a href="https://www.nacdonline.org/all-governance/governance-resources/directorship-magazine/online-exclusives/2025/q1-2025/the-evolving-role-of-audit-committees-in-2025-and-beyond/"><i>NACD’s</i><i> </i>Directorship® </a><i>Online.</i></span>

The Evolving Role of Audit Committees in 2025 and Beyond

Audit Committee

Audit Quality

Emerging Reporting Areas

In today’s rapidly evolving financial reporting and regulatory environment, fraud remains an ever-present threat, requiring vigilance and adaptation.

As the Director of Anti-Fraud Initiatives, I engage in meaningful conversations with a diverse group of stakeholders within the financial reporting ecosystem year-round...

In today’s rapidly evolving financial reporting and regulatory environment, fraud remains an ever-present threat, requiring vigilance and adaptation.

As the Director of Anti-Fraud Initiatives, I engage in meaningful conversations with a diverse group of stakeholders within the financial reporting ecosystem year-round to stay up to date on all issues related to fraud. At the Center for Audit Quality (CAQ), we recognize that the fight against fraud requires the collective effort of everyone within the financial reporting profession.

During the 2024 International Fraud Awareness Week, the CAQ, as a partner of the <a href="https://antifraudcollaboration.org/">Anti-Fraud Collaboration (AFC)</a>, hosted its inaugural Fraud Forum. This multi-stakeholder dialogue brought together key players from across the financial reporting ecosystem, in addition to investors and regulators, to explore emerging fraud risks, discuss best practices, and strengthen fraud deterrence and detection.

Read on for my takeaways from this special event.
<h3><strong>The Evolving Fraud Risk Landscape</strong></h3>
The fraud risk landscape grows more complex every day. Emerging risks such as geopolitical instability, third-party vulnerabilities, and challenges within the talent pipeline present new concerns that require fresh perspectives. Approaching these holistically ensures that fraud deterrence and detection strategies evolve alongside the shifting landscape.

In our discussions at the Fraud Forum, we learned that while fraud risk is inherent in capital markets, massive fraud is not pervasive across corporate America. However, too much emphasis is often placed on the likelihood of fraud rather than its potential impact. Companies should instead consider the potential impact of fraud to strengthen their deterrence and detection efforts.

According to the Association of Certified Fraud Examiners (ACFE)’s <a href="https://www.acfe.com/-/media/files/acfe/pdfs/rttn/2024/2024-report-to-the-nations.pdf">Occupational Fraud 2024: A Report to the Nations</a>, public companies have a better chance of detecting fraud sooner compared to other organizations. Anti-fraud controls embedded in an organization’s policy and practices can help proactively protect against fraud, including:
<ul>
 	<li>Code of conduct</li>
 	<li>Management certification of financial statements</li>
 	<li>Hotline</li>
 	<li>Internal audit department</li>
</ul>
[custom_quote text="While fraud risk is inherent in capital markets, massive fraud is not pervasive across corporate America."]
<h3><strong>Fraud Prevention: The Human Element</strong></h3>
Throughout my conversations with colleagues and subject matter experts, one theme consistently stands out: The human element is crucial in the fight against fraud.

Fraud is not just an accounting or technical issue; it is fundamentally a human problem. Culture and ethics play a critical role in mitigating fraud risk. A company’s ethical environment must be cultivated from the top down, promoting transparency, accountability, and integrity across all levels.

Additionally, hotlines and reporting mechanisms are essential tools in detecting fraud and should be widely utilized. Companies can also encourage employees to speak up and use whistleblower data to effectively offer valuable insights into risk areas. Consequently, organizations with strong internal reporting mechanisms tend to experience better business outcomes and lower fraud risks.

[custom_quote text="Hotlines and reporting mechanisms are essential tools in detecting fraud and should be widely utilized."]
<h3><strong>Strengthening Fraud Detection and Response</strong></h3>
Investor expectations regarding fraud detection are evolving. According to the CAQ’s 2024 <a href="https://www.thecaq.org/institutional-investor-survey-q4-2024">Institutional Investor Survey</a>, over half of investors believe that fraud goes undetected in the U.S. corporate reporting ecosystem.

Enhancing communication between investors and auditors, refining fraud-related procedures, and leveraging technology in fraud detection are vital steps. At the Fraud Forum, participants shared some practical steps to bolster fraud detection, including:
<ul>
 	<li>Enhancing fraud brainstorming sessions by involving forensic experts regularly.</li>
 	<li>Strengthening fraud inquiries with more open-ended questioning to uncover potential misconduct.</li>
 	<li>Investing in technology and data analytics to improve fraud detection and response times.</li>
 	<li>Assessing and utilizing hotline data more effectively to identify risk patterns and inform audit procedures.</li>
 	<li>Improving training and education to equip accounting and auditing professionals with the knowledge and skills needed to recognize fraud risks.</li>
</ul>
[custom_quote text="Investor expectations regarding fraud detection are evolving."]
<h3><strong>The Road Ahead</strong></h3>
The fight against fraud requires a collective effort from all members of the financial reporting ecosystem. While regulation and enforcement play crucial roles, transparency and collaboration are equally important.

The CAQ and AFC remain dedicated to convening these essential multi-stakeholder dialogues and driving meaningful change. As we look ahead, organizations must stay proactive, continually assess fraud risks, and implement innovative strategies to further strengthen fraud deterrence and detection.

The productive dialogue from the inaugural Fraud Forum is just the beginning. We invite financial reporting ecosystem stakeholders, regulators, and investors to join us in this ongoing effort to uphold the integrity of our capital markets. Together, we can build a stronger, more fraud-resilient future.

I encourage you to follow the <a href="https://antifraudcollaboration.org/">AFC </a>on <a href="https://twitter.com/antifraudcollab">X</a> and <a href="https://www.linkedin.com/company/antifraudcollaboration/">LinkedIn</a> to stay up to date on the latest anti-fraud issues and developments.

<span data-teams="true">You can read the full Fraud Forum summary <a href="https://antifraudcollaboration.org/fraud-forum-summary/">here</a>.</span>

Strengthening Fraud Deterrence and Detection: Key Insights from the AFC Fraud Forum

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.

Don't see the player? Please refresh the...

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.

<strong><em>Don't see the player? Please refresh the page.</em></strong>
<div id="buzzsprout-player-16685137"></div>
<script src="https://www.buzzsprout.com/2192286/episodes/16685137-capital-markets-pulse-q1-2025-insights-with-julie-bell-lindsay-and-dennis-mcgowan.js?container_id=buzzsprout-player-16685137&player=small" type="text/javascript" charset="utf-8"></script>

Podcast | Capital Markets Pulse, Episode 12: Dennis McGowan

Auditors

Policymakers

Investors

Podcast

Desiré Carroll, CPA, CA(SA) is a Senior Director, Professional Practice at the Center for Audit Quality. Her role involves advancing technical and policy-oriented projects to identify, develop, and seek consensus on issues affecting the public company auditing profession. This includes engaging with senior leaders across the financial reporting ecosystem, drafting comment letter responses to regulators, and developing thought leadership publications.

Before joining the CAQ, Desiré served as Associate Director – Sustainability Assurance at the American Institute of Certified Public Accountants (AICPA). Prior to that, she spent over 11 years at Deloitte primarily in their New York M&amp;A Transaction Services group and initially in their Audit practice. Desiré is a CPA and a South African Chartered Accountant.

Desiré Carroll, CPA, CA(SA)

Advances in technology and investor demand for climate-related information continue to transform the corporate reporting landscape.

As Senior Director of Professional Practice at the Center for Audit Quality (CAQ), I lead advanced technical and policy-oriented projects to identify, develop, and seek...

Advances in technology and investor demand for climate-related information continue to transform the corporate reporting landscape.

As Senior Director of Professional Practice at the Center for Audit Quality (CAQ), I lead advanced technical and policy-oriented projects to identify, develop, and seek consensus on issues affecting the public company auditing profession. We frequently analyze S&amp;P 500 companies’ disclosures to understand corporate reporting trends and emerging areas of investor interest, and provide recommendations to support all members of the profession in an ever-changing reporting environment.

In our latest analysis of S&amp;P 500 SEC Form 10-Ks, we dive into disclosure trends on <a href="https://www.thecaq.org/sp-500-10k-climate">climate-related information</a>. Given the proliferation of <a href="https://www.thecaq.org/sp-500-and-ai-reporting">artificial intelligence (AI)</a> across organizations, for the first time this year, we also reviewed AI disclosures in 10-K filings. Read on for my key takeaways.

[custom_quote text="We frequently analyze S&amp;P 500 companies’ disclosures to understand corporate reporting trends and emerging areas of investor interest."]
<h3><strong>Climate Reporting Continues to Increase</strong></h3>
The latest SEC Form 10-Ks (available as of June 30, 2024) demonstrate that organizations are regularly reporting various climate-related information. Our analysis found that most S&amp;P 500 companies mentioned climate-related information in their 10-K, an almost 4% increase from 477 companies in 2022 to 494 companies in 2023.

<img class="alignnone wp-image-15950 size-full" src="https://www.thecaq.org/wp-content/uploads/2025/02/2025_02_AiA_10k_Climate-Related-Information-Mentioned-in-10-K.jpg" alt="" width="1200" height="627" />

We found that the types of information included in the climate-related disclosures varied from company to company. Several companies associated dollar amounts with their climate-related information, which included capital expenses, research and development (R&amp;D) costs, losses associated with severe weather events, and more. Some companies disclosed the use or sale of carbon offsets or renewable energy certificates (RECs), often in relation to their discussion around GHG emissions reductions or other related goals.

In light of investor demand and the global focus on net zero commitments at the time this data was released, more companies disclosed a net zero or carbon neutral commitment than in years past, with a 7% increase from 2022. While the target dates varied, we observed that the most common target date was 2050 for both net zero and carbon neutral commitments.

<img class="alignnone wp-image-15951 size-full" src="https://www.thecaq.org/wp-content/uploads/2025/02/2025_02_AiA_10k_Net-Zero-or-Carbon-Neutral-Commitment-Mentioned-in-10-K.jpg" alt="" width="1200" height="627" />

Furthermore, climate-related mentions in financial statements nearly doubled from the prior year. While companies increased disclosures across various footnotes, we observed the greatest increase in disclosures related to sustainability-linked debt or borrowing arrangements.

This year, we also reviewed whether companies mentioned any ESG reporting standards and frameworks or any upcoming ESG reporting requirements beyond the <a href="https://www.thecaq.org/summary-of-the-enhancement-and-standardization-of-climate-related-disclosures-for-investors">2024 SEC Climate Rule</a> in their 10-Ks. We discovered that roughly 17% of companies mentioned using specific ESG reporting standards or frameworks for their sustainability reporting. Many companies mentioned using more than one standard or framework for their sustainability reporting, with the most common being the TCFD recommendations followed by the SASB standards.

[custom_quote text="Furthermore, climate-related mentions in the financial statements nearly doubled from the prior year."]
<h3><strong>The Rise of AI-Related Disclosures</strong></h3>
For the first time, we reviewed AI-related disclosures to understand where companies were disclosing this information within their 10-Ks and what they were typically disclosing about AI.

We found that 359 companies, or 72% of S&amp;P 500 companies, mentioned AI-related information in their 10-Ks. Most companies that mentioned AI-related information did so in Item 1A. Risk Factors (312) and Item 1. Business (176). Some companies also mentioned AI within Item 7. MD&amp;A (69) and Item 8. Financial Statements (36).

<img class="alignnone wp-image-15955 size-full" src="https://www.thecaq.org/wp-content/uploads/2025/02/2025_02_AiA_10k_Section-of-10-K-AI-is-Mentioned.jpg" alt="" width="1200" height="627" />

When discussing AI-related topics in Item 1A. Risk Factors, companies largely focused on legal, regulatory, reputational, and cybersecurity risks. Legal and regulatory risks were noted around companies' or third parties' rapid adoption of AI technologies and the privacy or protection of data within these technologies that could be subject to laws, policies, legal obligations, and codes of conduct.

Additionally, companies were concerned that the aggressive use of AI technologies by new entrants to the market may decrease their competitiveness and harm their performance and reputation. Companies noted that the use of data by AI tools increased their exposure to cybersecurity events and flagged that malicious actors could use these technologies to access, use, disclose, or destroy information.

We also observed disclosures that described investments in AI, as companies discussed their use of and investment in AI-related technologies within Item 1. Business.

At the CAQ, we will continue monitoring how companies report this information and how our profession can support high-quality disclosures. Be sure to follow us on <a href="https://www.linkedin.com/company/2859773/">LinkedIn</a> for the latest updates.

[custom_quote text="When discussing AI-related topics in Item 1A. Risk Factors, companies largely focused on legal, regulatory, reputational, and cybersecurity risks."]

Analyzing S&P 500 Companies’ 10-K Disclosures: Climate and 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" />

Join us for a discussion about the fourth edition of the Audit Committee Practices Report, 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>: This webcast is eligible for 1 CPE credit to those who attend the webcast live.</em>

Webinar | Audit Committee Practices Report

Webinar

Event

<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

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

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

Company Management

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

Welcome back, Audit Insiders. I hope 2025 has been a great year for everyone so far, and that we have some spring weather on the horizon. For us in the financial reporting profession, it certainly has been a busy time.

Here...

Audit Insider | January/February 2025

Newsletter

The CAQ is pleased to share our views related to the California Air Resources Board (CARB) Information Solicitation to Inform Implementation of California Climate-Disclosure Legislation: Senate Bills 253 and 261, as amended by SB 219.

Given our role, our comments are focused...

The CAQ is pleased to share our views related to the California Air Resources Board (CARB) <em>Information Solicitation to Inform Implementation of California Climate-Disclosure Legislation: Senate Bills 253 and 261, as amended by SB 219</em>.

Given our role, our comments are focused on the assurance-related aspects of the solicitation. Our response highlights the benefits of assurance, the benefits of assurance engagements performed by professional accountants, and provides insights into key considerations for CARB in drafting the assurance-related aspects of the upcoming regulation. Our letter provides insight into the following key elements that the CARB should incorporate into the regulation as the assurance requirements are drafted:
<ol>
 	<li>Recognized reporting standards should be specified to enable assurance</li>
 	<li>Acceptable assurance standards should be specified</li>
 	<li>Levels of assurance should be specified</li>
 	<li>Minimum requirements for assurance providers should be specified</li>
 	<li>The importance of oversight of assurance providers</li>
</ol>
We are pleased that certain key elements are already included in SB 253 (i.e., specifying use of a recognized reporting standard and specifying the levels of assurance required). To promote consistent, comparable, and reliable assurance, we encourage the CARB to incorporate the remaining elements, leveraging the existing assurance ecosystem, to help maximize the benefits that can be derived from assurance engagements.

Read the full comment letter <a href="https://www.thecaq.org/wp-content/uploads/2025/03/caq_carb_comment-letter_final_3_21_2025.pdf">here</a>.

Comment Letter | CARB: Information Solicitation to Inform Implementation of California Climate-Disclosure Legislation: Senate Bills 253 and 261, as amended by SB 219

The Center for Audit Quality

The Audit Effect

Audit Quality

Independence

Anti-Fraud

DEI

ESG

Corporate Reporting Trends

Trending Resources

Stay Connected.