Welcome to another edition of Capital Markets Pulse, a monthly newsletter from the Center for Audit Quality that brings you insights, resources, and tools on the latest issues impacting the capital markets
And welcome to 2025, readers. The year started with no shortage of major news coming from the new Administration, from political appointments to executive orders. In areas where we pay particularly close attention, SEC Commissioner Mark Uyeda has been named Acting SEC Chair and Ryan Wolfe has been named Acting SEC Chief Accountant. And, as of this writing, we are waiting for the Senate to schedule a confirmation hearing for Paul Atkins, President Trump’s nominee to Chair the SEC. Read on for some preliminary actions by Acting Chair Uyeda below.
As these developments continue to unfold, I have no doubt that the remainder of 2025 will be a busy and impactful year for the public company audit profession. In anticipation of this year, I released my outlook with key trends to watch for 2025 and had a discussion with my colleague Dennis McGowan on these themes – more on both below.
On a lighter note, 2025 did start with one major positive for me – THE Ohio State University Buckeyes winning the national championship in the first-ever 12-team playoff. It’s always Ohio Against the World – and this time, Ohio won!
Back to the year ahead, while there will no doubt be uncertainties, I am looking forward to another year of working with the audit profession, all our stakeholders in the corporate reporting ecosystem and my incredible and hard-working team here at the CAQ. Together, we can ensure the capital markets remain resilient, transparent, and trusted.
Read on for the latest updates and insights from the profession.
Please note that these perspectives are my own. If this email was forwarded to you, subscribe here so that you never miss a public company auditing update.
CAQ Updates
My 2025 Profession Outlook: Regulatory changes, technology trends and focus on talent
At the start of each year, I like to highlight my outlook for the public company audit profession. From a new Administration to the pipeline and talent challenges we continue to face as a profession – I am prepared for an incredibly significant year. In 2025, I see the following as key areas to watch:
- Regulatory Developments – Recent Supreme Court cases could impact the SEC and PCAOB’s operations, making it more important than ever to ensure a strong, inclusive, and data-driven standard-setting process. Successful implementation of the PCAOB’s updated standards will play a critical role in maintaining audit quality and investor confidence.
- Technology & AI – Emerging technologies, particularly AI, are transforming the audit profession. While automation enhances efficiency, it also shifts auditors’ focus to more complex, high-value areas that require professional judgment.
- Talent & Workforce – Attracting and retaining top talent remains a priority. Increased starting salaries and alternative CPA licensure pathways could help to bring new professionals into the field, ensuring a strong pipeline for the future.
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.
Read my full outlook: 2025 Profession Outlook: Auditors Will Continue to Provide Stability and Dependability During Changing Times.
Capital Markets Pulse Podcast: 2025 Outlook with Dennis McGowan
The CAQ’s Vice President for Professional Practice and Anti-Fraud Initiatives, Dennis McGowan, and I discuss the above themes and more in the latest episode of Capital Markets Pulse.
Listen to the full podcast here.
Be sure to subscribe to the latest episodes on Spotify, Apple Podcasts, Google Podcasts, or Amazon Music.
Annual Survey of Institutional Investors Finds Satisfaction with Financial Reporting
Earlier this year the CAQ released the results of our annual institutional investor survey with valuable insights from institutional investors into capital market matters, including financial reporting and audited financial statements, expanded assurance, the regulatory landscape and fraud, and emerging technologies.
The good news? Nearly all institutional investors agree that the current state of public company financial reporting is sufficient for investment decisions, and 90% express a high degree of reliance on, and trust in, audited financial statements. Similarly, most investors express satisfaction with the current level of transparency in the audit process, with 89% of investors indicating that they are “very” or “extremely” satisfied with the level of transparency.
However, the report also highlighted areas for improvement. For example, regarding new sources of company-prepared information, three-fourths of investors consider climate-related risks, cybersecurity, and AI disclosures in their decisions. While investors find value in these newer types of information, more than 80% cite a need for improvement in the quality of the information, with 40% saying significant enhancements are needed to improve reliability and usability. Key priorities include better standards, comparability, and consistency.
Download the report for more investor insights: Institutional Investor Survey | Research Findings, Q4 Survey.
Annual Audit Committee Practices Report Identifies Top Priorities for Audit Committees
The CAQ and Deloitte’s Center for Board Effectiveness published their annual Audit Committee Practices Report identifying key audit committee practices and other common threads.
The results of this year’s report find that:
- Cybersecurity remains the top priority for audit committees at public companies, outside of financial reporting and internal controls, with 93% of respondents ranking it among their top three priorities.
- When presented with strategies to enhance audit committee effectiveness, more than two-thirds of respondents (69%) felt meetings might be improved by implementing strategies including increasing the quality of presentations and better engagement during meetings.
- Increased understanding of the impact and usage of AI, with the number of respondents who identified AI governance as a priority grew year over year, jumping to 35% from 20% last year.
Download the full report to see the results from the survey.
Accounting+ and EVERFI Kick-Off 2025 Student Events
As I mentioned in my Outlook, 2025 will be a critical year for the profession to make an impact in the pipeline challenges we face.
To that end, the CAQ and our strategic partner EVERFI kicked off the year with several events highlighting the Accounting Careers: Limitless Opportunities program. The national program, part of CAQ’s Accounting+ initiative, is increasing interest in the accounting profession by leveraging EVERFI’s extensive high school network across the country to reach students – at scale – at a crucial career planning stage, showcasing accounting as an accessible and attractive career option for all.
Each school year, select schools are offered the opportunity to participate in a signature “Accounting for YOUR Future” event. Recent events took place in New York and Washington D.C. and have featured professionals from firms and other professional associations, such as CPA state societies, who share their real-life career experiences with high school students, while dispelling common myths about the accounting industry. The next signature events for the 2024-2025 school year will be hosted at schools in Chicago and Indianapolis and will guarantee a $5,000 scholarship to a deserving student at each event.
To date, the CAQ’s partnership with EVERFI via Accounting+ has enabled more than 170,000 high school students across the country (in every state, Washington, DC and multiple territories) to engage with the Accounting Careers: Limitless Opportunities curriculum in the classroom. On the ground, students are getting an early start building their networks by talking to people working as accountants and people organizations like the Pittsburgh Steelers that are championing accounting awareness.
Profession Updates
SEC
Announces Acting Chair Mark Uyeda and Chief Accountant Ryan Wolfe
As noted above, shortly after the inauguration, President Trump designated SEC Commissioner Mark Uyeda as Acting Chairman of the SEC. Acting Chair Uyeda has since announced several new acting senior staff, including Acting Chief Accountant Ryan Wolfe, who previously served as Chief Accountant in the SEC’s Division of Enforcement. We look forward to working with Acting Chair Uyeda and Acting Chief Accountant Wolfe as the public company audit profession continues to adapt and innovate to ensure the capital markets retain their integrity and reliability in the face of new challenges.
SEC’s Final Climate Disclosure Rules Further Delayed
Earlier this month, Acting Chair Uyeda asked the 8th Circuit Court of Appeals to delay proceedings on the consolidated lawsuits against the SEC’s climate disclosure rule. Citing concerns over the SEC’s authority and process to develop and implement the rule, as well as the impact of the rule on capital markets, Acting Chair Uyeda made the decision to request a delay in court proceedings to allow for the SEC to further consider the rule.
Crypto Task Force
Acting Chair Uyeda has also created a new crypto task force, led by SEC Commissioner Hester Peirce, to build a comprehensive crypto asset regulatory framework, with the goal of bringing clarity on oversight, registration, and enforcement when it comes to crypto assets. Recently, Commissioner Peirce issued a statement seeking the public’s input on a range of issues surrounding these assets, including commonly accepted practices for auditing and accounting for crypto asset investments and transactions and valuation matters.
PCAOB
PCAOB’s Firm and Engagement Metrics, Firm Reporting Proposals Withdrawn
Earlier this month, the SEC announced that the PCAOB withdrew its final rules on firm and engagement metrics and firm reporting which had been submitted to the SEC for approval late last year. Given the concerns expressed by many commenters, the CAQ appreciates this decision which will allow for a more thorough examination of the rules and their intended benefits. As the CAQ noted in its own comments to the SEC and PCAOB, in our research investors and audit committees expressed mixed opinions on the utility, value, and likely use of the proposed metrics and other required disclosures, with 70% opposing firm and engagement metrics while 85% opposed firm reporting. Recently submitted comment letters from the CAQ’s smaller firm task force (SFTF) and audit committee council (ACC) highlighted similar concerns.
Julie Bell Lindsay
Chief Executive Officer, CAQ