PCAOB Outlines Priorities for 2023 Inspections
The Public Company Accounting Oversight Board (PCAOB) has outlined its priorities for 2023 inspections in a recently released staff report. The report reveals plans to increase the focus on fraud-related audit procedures, continue prioritizing risks related to material digital assets and continue selecting audits in the financial services sector for inspection, among other priorities.
The PCAOB said that last year it found a year-over-year increase in the number of audits with deficiencies at audit firms the PCAOB inspected in 2021.
The complete list of 2023 inspection priorities outlined in the report includes:
- Risk of fraud
- Auditing and accounting risks
- Risk assessment and internal controls
- Financial services-specific considerations
- Broker-dealer-specific considerations
- M&A, including de-SPAC transactions
- Digital assets
- Use of the work of other auditors
- Quality control (particularly talent retention and its impact on audit quality, and independence)
- Other areas of inspection (critical audit matters, cybersecurity, and use of data and technology in the audit)
The report notes the target team of inspectors will focus its work in 2023 on audits that include risks related to digital assets, first year audits, multi-location audits, and significant or unusual events or transactions. As part of ongoing efforts to enhance inspections, the report also says inspectors will expand the number of audits they review for certain annual firms.