SEC official: PCAOB’s standard setting too slow

The PCAOB’s pace of developing auditing standards is too slow, SEC Chief Accountant James Schnurr said. He plans reviews of the process in hopes of speeding it up.

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Generally, I agree. The PCAOB should be up-to-date in its overview actions – shareholders deserve the best. Events simply move faster than regulatory entities can adjust.  But also interesting – the SEC criticizing the PCAOB? Looking at itself, is the SEC really in a position to criticize?

Question – if it is determined after-the-fact that an audit firm lacks independence, is the audit by that firm of any value?  In other words, can the audit still be relied upon?  One of the keystones of audit is that the auditing firm is independent of the entity that it is auditing. Perhaps it can still be determined that the issue or area causing the lack of independence did not materially impact the audit and the audit opinion?  But this is problematic.

Dave Tate, Esq. (San Francisco / California)