In February 2014, the Public Company Accounting Oversight Board (PCAOB) stated it will no longer focus on passing regulations which would ultimately impose term limits for auditors of public companies. The decision comes nearly three years after the PCAOB originally proposed the idea. The PCAOB has met with heavy opposition to the idea of auditor rotation, receiving comment letters from both auditing firms and corporate board members and management who were concerned that auditor rotation would leave the companies with inexperienced auditors and ultimately impact the overall quality of the audits completed.
This differs from regulations passed during December in Europe where the European Parliament and EU Member States reached an agreement that calls for mandatory 10-year limits on audit firms and new limitations on non-audit services that auditors can perform for public interest entities.
For more information, please contact Charles A. Oshurak, Audit Advisory Senior Manager, within Audit and Assurance practice. To learn more about the services we provide to public companies and the PCAOB, visit our webpage!
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