The Public Company Accounting Oversight Board (PCAOB) has released a report outlining its inspection priorities for 2025, emphasising sectors such as financial, real estate, and information technology.
PCAOB is a nonprofit corporation that oversees the audits of publicly traded companies in the US.
The staff report details the risks and considerations auditors should account for in their current and future audits.
It also suggests questions for audit committees to enhance their oversight role.
PCAOB chair Erica Williams said: “Inspecting audit firms is one of the most important tools the PCAOB uses to protect investors.
“We encourage audit firms and audit committees to read this report, which provides timely perspectives to drive improvements in audit quality.”
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By GlobalDataIn 2025, the PCAOB aims to continue to select audits of companies in industries with specialised accounting requirements or those affected by economic and geopolitical uncertainties.
The selection process will also focus on sectors with a history of deficiencies and companies with increased going concern risks.
Supply chain challenges and merger and acquisition activities are other areas of emphasis.
The PCAOB staff plans to concentrate on areas that are seen to present a “higher” risk to audit quality.
These include audit areas with prior execution challenges, application of new auditing standards, critical audit matters, and increased use of technology, including generative artificial intelligence.
Inspections will also cover crypto assets and quality control procedures, particularly for firms adopting alternative practice structures.
Earlier in December 2024, another Public Company Accounting Oversight Board (PCAOB) report highlighted opportunities for audit firms to enhance their cultures of accountability in order to boost audit quality.
This conclusion is based on a comprehensive review, including more than 150 interviews with partners from the largest US audit firms.
