Aug 31, 2012
From the Audit Committee Institute
With the Public Company Accounting Oversight Board's recent approval of Auditing Standard No. 16, "Communications with Audit Committees," the importance of robust, two-way communications to improve the transparency and integrity of financial reporting will continue to be front-and-center.
While the auditor communications required by Auditing Standard No. 16 largely take place today (in practice and as a result of SEC and stock exchange rules), the new standard incorporates these communications -- with some enhancements and additions -- to ensure that the audit committee is provided with key information related to the audit.
The new standard includes four objectives for the auditor's communications with the audit committee.