The Public Company Accounting Oversight Board (PCAOB) has adopted a set of ethics and independence rules that are of great interest to practitioners. They include eagerly awaited guidance on when offering tax services compromises independence, required procedures to be followed when auditors provide tax services, and the significance of contingent fee arrangements.
These rules were eagerly awaited by PCAOB-registered public accounting firms who audit public companies, and other CPA firms that see the rules as possibly providing them with increased opportunities to pick up work currently performed for a public company by its auditor.
The PCAOB also adopted a standard on engaging an auditor to report on whether a previously reported material weakness continues to exist. That standard will provide a means for public companies to give investors assurance that a material weakness has been remedied by an interim date set by the company that is prior to a date for a required filing with the SEC.
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