Public Company Accounting Oversight Board (PCAOB)

Public Company Accounting Oversight Board (PCAOB)

The Public Company Accounting Oversight Board (PCAOB) is a non-profit organization that regulates auditors of publicly traded companies. The Standing Advisory Group met twice in 2018 and discussed data and technology, cybersecurity, corporate culture, communications on PCAOB standards, the governance and leadership of quality control systems, current or emerging issues affecting audits or auditors, and implementation of the new auditor’s report. The Public Company Accounting Oversight Board (PCAOB) is a non-profit organization that regulates audits of publicly traded companies to minimize audit risk. PCAOB is overseen by the Securities and Exchange Commission and, since 2010, the PCAOB has overseen the audits of SEC-registered brokers and dealers. The Public Company Accounting Oversight Board (PCAOB) is a non-profit organization that regulates auditors of publicly traded companies.

The Public Company Accounting Oversight Board (PCAOB) is a non-profit organization that regulates audits of publicly traded companies to minimize audit risk.

What Is the Public Company Accounting Oversight Board (PCAOB)?

The Public Company Accounting Oversight Board (PCAOB) is a non-profit organization that regulates auditors of publicly traded companies. The purpose of PCAOB is to minimize audit risk.

The Public Company Accounting Oversight Board (PCAOB) is a non-profit organization that regulates audits of publicly traded companies to minimize audit risk.
The PCAOB was established at the same time as the Sarbanes-Oxley Act of 2002 to address the accounting scandals of the late 1990s.
The board protects investors and other stakeholders of public companies by ensuring that auditors follow strict guidelines.

Understanding the Public Company Accounting Oversight Board

The Public Company Accounting Oversight Board (PCAOB) was established with the passage of the Sarbanes-Oxley Act of 2002. The act was passed in response to various accounting scandals of the late 1990s. The board protects investors and other stakeholders of public companies by ensuring that the auditor of a company's financial statements has followed a set of strict guidelines. PCAOB is overseen by the Securities and Exchange Commission and, since 2010, the PCAOB has overseen the audits of SEC-registered brokers and dealers.

Public Company Accounting Oversight Board (PCAOB) Advisory Groups

The PCAOB has two advisory groups: the Standing Advisory Group and the Investor Advisory Group. The role of these two groups is to provide advice and insight to the Board.

The Standing Advisory Group met twice in 2018 and discussed data and technology, cybersecurity, corporate culture, communications on PCAOB standards, the governance and leadership of quality control systems, current or emerging issues affecting audits or auditors, and implementation of the new auditor’s report. According to the latest annual report, The Investor Advisory Group met in November 2018. Subjects under discussion were the group's strategic plan, quality control standards, implementation of the new auditor’s report, and implementation of Form AP.  

The PCAOB Board has a five-step strategic plan, which is laid out in its 2018 annual report. The five-step plan is composed of the following:

Source: 2018 PCAOB Annual Report

The number of PCAOB-registered firms in the United States as of December 2018, according to the PCAOB annual report.

PCAOB in 2018

Firms that audit public companies, brokers, and dealers must register with the PCAOB. Registered firms are subject to inspection of the audits they have performed. PCAOB is involved in setting standards aimed at improving the reliability of audits and may also enforce standards by imposing penalties for infractions. In 2018, PCAOB settled 20 disciplinary orders and brokered 24 cooperative agreements with foreign audit regulators following a deal with Austria in 2018.

In 2018, the Board initiated a collaborative strategic planning process. The PCAOB also conducted an organizational assessment that resulted in transformation initiatives across all PCAOB programs and activities.

Related terms:

Antitrust

Antitrust laws apply to virtually all industries and to every level of business, including manufacturing, transportation, distribution, and marketing. read more

Audit Risk

Audit risk is the risk that financial statements are materially incorrect, even though the audit opinion states that there no material misstatements. read more

Audit : What Is a Financial Audit?

An audit is an unbiased examination and evaluation of the financial statements of an organization. read more

Auditability

Auditability describes the ability of an auditor to achieve accurate results in the examination of a company's financial reporting. read more

Auditing Evidence

Auditing evidence is information collected to review a company's financial transactions, internal control practices, and other items needed for an audit. read more

Auditing Standards Board (ASB)

The Auditing Standards Board (ASB) issues guidelines and rule pronouncements that certified public accountants (CPAs) must adhere to in audits and attestations. read more

Certified Financial Statement

A certified financial statement is a financial reporting document that has been audited and signed off on by an accountant. read more

Internal Controls

Internal controls are processes and records that ensure the integrity of financial and accounting information and prevent fraud. read more

Sarbanes-Oxley (SOX) Act of 2002

The U.S. Congress passed the Sarbanes-Oxley (SOX) Act of 2002 to help protect investors from fraudulent financial reporting by corporations read more

Securities and Exchange Commission (SEC)

The Securities and Exchange Commission (SEC) is a U.S. government agency created by Congress to regulate the securities markets and protect investors. read more