The PCAOB has posted a 2023 audit committee resource that identifies a number of questions that audit committees may want “to consider amongst themselves or in discussions with their independent auditors, particularly given today’s economic and geopolitical landscape.” The topics include the risk of fraud, risk assessment and internal controls, auditing and accounting risks, digital assets, M&A activities, use of the work of other auditors, talent and its impact on audit quality, independence, critical audit matters and cybersecurity. Audit committee members will certainly want to review the resource in its entirety, but, to give you a flavor, summarized below are some of the questions.
- With regard to the risk of fraud, the PCAOB suggests that audit committees ask about whether the auditors identified any new risks of fraud and, if not, what procedures the auditors performed, including identifying any new procedures. What procedures did the auditors perform to identify potential related-party transactions? How did they determine if significant unusual transactions had a valid business purpose or determine if management perpetrated fraud? Did the auditors ask management about…
