PCAOB Publishes Guidance for Quality Control Remediation
The PCAOB recently released a staff report intended to assist audit firms in remedying quality control issues cited during the inspection process.
The new report offers advice for firms dealing with remediation following findings of quality control criticisms (QCCs). If a firm does not address a QCC to the Board’s satisfaction within 12 months of the date of the inspection report, the PCAOB publicly discloses its quality control deficiencies.
At the present time, a 2006 release describes the remediation process, together with Staff Guidance published in 2013. The new staff report shares guidance gathered since the 2013 report.
The report reviews the 2013 guidance and highlights seven further considerations for firms during the QCC remediation process:
- Repeated or persistent criticisms require a new or enhanced response
- The importance of root-cause analysis
- How the PCAOB considers subsequent inspection results
- How the PCAOB evaluates the design of new or revised guidance, tools or policies from firms
- What the PCAOB considers when evaluating the design of training programs
- PCAOB expectations on the timing of remediation design and implementation
- The value of ongoing dialogue
The PCAOB will continue to work on determining whether to formally update its Staff Guidance.