AICPA Proposes When to Use Multiple Auditing Rules

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By Steve Burkholder

Aug. 17— Auditors who use auditing standards of the Public Company Accounting Oversight Board—but aren't within that regulator's jurisdiction—also should conduct audits under generally accepted auditing standards (GAAS), the American Institute of CPAs' Auditing Standards Board says.

The AICPA has proposed an amendment to its auditing standards that probably will affect mostly clearing agencies and futures commission merchants registered with the Commodity Futures Trading Commission, according to the proopsal's exposure draft that AICPA issued Aug. 14.

Using PCAOB Standards

In the proposal, the AICPA's Auditing Standards Board addressed the situation in which an entity, whose audits aren't under authority of the PCAOB, nonetheless seeks an audit conducted in accordance with the regulator's standards. The entity might seek to use the PCAOB standards because it is required to do so by an agency, by a regulator, or by contract, the ASB wrote.

In such situations, the AICPA's Code of Professional Conduct requires members to also carry out the audit in accordance with GAAS, according to the proposal. Using GAAS leads to the audit being conducted under more than one set of auditing standards.

In the described scenario, when the auditor refers to PCAOB standards in addition to GAAS, the auditor should use the report layout and wording prescribed by the auditing standards of the PCAOB. However, the layout and wording would be changed to signal “that the audit was also conducted in accordance with GAAS,” the AICPA auditing rules panel wrote.

Documents Filed With SEC

The financial statements of the reporting entity and the auditor's report may, under certain circumstances, be filed with or provided to the Securities and Exchange Commission, ASB wrote.

The ASB cited examples of entities whose audits don't fall under the purview of PCAOB:

• securities clearing agencies;

• futures commission merchants registered with the CFTC; and

• certain other entities registered with the CFTC that aren't also SEC-registered broker-dealers in securities.


Effective for 2015 Statements' Audits 

The proposed changes—amendment to Statement of Auditing Standards No. 122 Section 700, Forming an Opinion and Reporting on Financial Statements—also include requirements and guidance for reporting on an audit conducted under both GAAS and PCAOB standards.

The draft auditing standards would be effective for audits of financial statements for periods ending or after Dec. 15 of this year.

The Auditing Standards Board requests that comments be sent by Sept. 30.

To contact the reporter on this story: Steve Burkholder in Norwalk, Conn., at

To contact the editor responsible for this story: Laura Tieger Salisbury at

The AICPA's proposed amendment to auditing standards is available at