State Board Report
The Public Company Accounting Oversight Board’s December report on its 2010 inspections of eight domestic registered firms, the largest firms which have been inspected every year since the PCAOB’s inspection program began, reveals 15 percent of the integrated audit engagements inspected (46 of 309) had failed to obtain sufficient audit evidence, to support the audit opinion on the effectiveness of internal control, due to one or more deficiencies identified by the PCAOB’s inspections staff.
“The Board is concerned about the number and significance of deficiencies identified in the firms’ audits of internal control during the 2010 inspections, which generally involved reviews of integrated audits of financial statements and internal control (‘integrated audits’) for issuers’ fiscal years ending in 2009,” the report states. “Although not specifically described in this report, the Board is also concerned that the rate of these deficiencies increased during the Board’s 2011 inspections.” Though not yet finalized, those reports found insufficiently supported opinions on the effectiveness of internal control in 22 percent of the engagements inspected.
Among the root causes the PCAOB believes may have contributed to the deficiencies in the audit of internal control are:
- MEMBER CENTER