{"id":25544389,"date":"2023-02-01T02:37:54","date_gmt":"2023-02-01T01:37:54","guid":{"rendered":"https:\/\/kn.wmhosts.com\/?p=25544389"},"modified":"2024-04-04T04:39:45","modified_gmt":"2024-04-04T02:39:45","slug":"topping-up-your-past-audits-to-pcaob-standards","status":"publish","type":"post","link":"https:\/\/kn.wmhosts.com\/?p=25544389","title":{"rendered":"Topping up your past audits to PCAOB standards"},"content":{"rendered":"\n

If your company is thinking about an IPO in the US, you need to understand how your current auditors are involved, and the extra effort that will be required of them.<\/p>\n\n\n\n

Likely, they will need to \u201ctop-up\u201d and extend their audit procedures on all years that will be covered in your prospectus. This will take time and should be contemplated well in advance.<\/p>\n\n\n\n

You might not be able to use current auditors if they don\u2019t meet the increased independence requirements, or wait until that period expires.<\/p>\n\n\n\n

Here are some of the ways you may need to revisit some of the audit work that has been done in the past:<\/p>\n\n\n\n

    \n
  1. Internal control testing: <\/strong>In many cases, even when audit assertion on ICFR is not yet required, the auditors will need to gain a better understanding of the internal control and risk assessment framework. This is likely more stringent than what has been required under ISA, AICPA, or other audit standards.<\/li>\n\n\n\n
  2. Independence assessment: <\/strong>Often, as a private company, your auditors may provide fuller scope of non-audit services, such as tax, other advisory, or even bookkeeping. This is not allowed under PCAOB independence standards, and a strict independence review is required to determine if you can continue to use your auditors. You may need to change firms or wait for independence issues to expire before you can IPO.<\/li>\n\n\n\n
  3. Documentation: <\/strong>Documentation in PCAOB audits is seen as more prescriptive in everything from understanding risk assessments, walkthroughs, substantive testing, and conclusions. Audit teams need to roll out additional workpapers for documentation as part of these audits, and may need to make additional management inquiries.<\/li>\n\n\n\n
  4. Use of outside experts: <\/strong>Whether your auditors need to bring in an outside expert (such as for valuations), or use a foreign audit team, there are different documentation and reporting requirements that exist under PCAOB audits which may need to be assessed.<\/li>\n\n\n\n
  5. Going concern: <\/strong>PCAOB has different verbiage on the time for assessing going concern, which may lead to a change in conclusion versus previous audits.<\/li>\n<\/ol>\n\n\n\n

    As always, best to discuss this early and often with those parties involved \ud83d\ude09<\/p>\n\n\n\n

    Any other tips & tricks from those who has been there? \ud83d\udc47<\/p>\n","protected":false},"excerpt":{"rendered":"

    If your company is thinking about an IPO in the US, you need to understand how your current auditors are involved, and the extra effort that will be required of them. Likely, they will need to \u201ctop-up\u201d and extend their audit procedures on all years that will be covered in your prospectus. This will take […]<\/p>\n","protected":false},"author":2,"featured_media":25544422,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"off","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[12],"tags":[22,23,24],"dipi_cpt_category":[],"class_list":["post-25544389","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-ipo","tag-audit","tag-ipo","tag-pcaob"],"yoast_head":"\nTopping up your past audits to PCAOB standards - Katrina Nacci, CPA<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/kn.wmhosts.com\/?p=25544389\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Topping up your past audits to PCAOB standards - Katrina Nacci, CPA\" \/>\n<meta property=\"og:description\" content=\"If your company is thinking about an IPO in the US, you need to understand how your current auditors are involved, and the extra effort that will be required of them. 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