As you probably recall, SOX 404 requires public reporting companies to disclose the effectiveness of their internal control over financial reporting. SOX 404(a) public companies to provide an assessment of ICFR by management; SOX 404(b) requires public companies—other than non-accelerated filers and emerging growth companies—to provide an auditor attestation regarding management’s assessment of the effectiveness of ICFR. A new study by Audit Analytics examining the most recent trends in SOX 404 disclosures over 17 years showed a decline in the number of adverse auditor attestations—auditor attestations indicating ineffective ICFR—and adverse management assessments, while the number of adverse management-only assessments increased. Why that variation? Could it reflect the effect of the recent SEC carve-out from the 404(b) requirement for low-revenue companies?
Audit Analytics has just released a deep dive into the impact of COVID-19 on financial reporting and financial wellbeing. To assess the effect of the pandemic, the report looked at going-concern audit opinions, impairment charges, late filings and changes in the control environment, as well as restatements. Some of the results might be surprising. For example, the pandemic had a significant impact on impairment charges, but the number of going-concern qualifications in audit opinions? Not so much.
2017 Audit Committee Transparency Barometer from the Center for Audit Quality shows continued increase in enhanced disclosures
Earlier this month, the Center for Audit Quality together with Audit Analytics posted their annual Audit Committee Transparency Barometer, which measured the quality of proxy disclosures regarding audit committees among companies in the S&P Composite 1500. The report shows continued voluntary enhancements to transparency and broadly increased disclosure around audit committee oversight of the external auditor. The report includes several useful examples of the types of disclosure discussed.
by Cydney Posner The Center for Audit Quality and Audit Analytics have jointly released their second-year analysis, Audit Committee Transparency Barometer. The analysis, which studied proxy statements of companies in the S&P Composite 1500, showed “double-digit growth in the percentage of S&P 500 companies disclosing information in several key areas […]