Today’s audit committees have a lot on their plate, which is why it’s important for boards to stay abreast of key audit committee issues. What new audit regulations should be on the board’s radar? What improvements have audit committees made to their voluntary disclosures—and which disclosure topics demand more attention?
In this episode, Cindy Fornelli, Executive Director at the Center for Audit Quality (CAQ), shares key updates on retail investor confidence, audit disclosure trends, and upcoming regulations.
For 11 consecutive years, the CAQ has conducted its Main Street Investor Survey, which not only gauges investors’ confidence in capital markets or key audit players, but attempts to identify the source of their confidence levels.
“What was interesting this year was that the Trump Administration was both a source of confidence and [a reason] for lack of confidence…” said Fornelli. “Good or bad, supporter or not supporter, republican or democrat—what the president does and what happens in Washington is important to investors.”
Boardroom Resources published a highlights blog following the 2017 survey results, which looked specifically at investor confidence levels for board members, audit committees, and public company management.
It’s a system—and we all have our role to play. The role of the external auditor is very important…The role of the board of directors…The role of the independent audit committee, regulators, educators…What I think you’ve see in the last ten or fifteen years is all of those players doing their own part for continuous improvement, but also collaborating together to supplement and enhance the work of others.
Fornelli also gives an update from the CAQ’s Transparency Barometer, which provides a benchmark for key areas of voluntary audit committee disclosure (e.g., external auditor selection and evaluation). Finally, she discusses the SEC-approved enhancements to the PCAOB reporting model and explains how boards should begin preparing for those changes.