Dating management representation letter
Accordingly, the rule sets forth restrictions, including but not limited to, on financial, employment, and business relationships between an accountant and an audit client and restrictions on an accountant providing certain non-audit services to an audit client.
These restrictions are prescribed in paragraphs (c)(1) to (c)(8) of S-X 2-01.
If a company previously explained the PCAOB registration revocation in its Item 4.01 Form 8-K, it need not repeat this disclosure in its Form 10-K.
The SEC will not recognize any person as a certified public accountant unless duly registered (licensed to practice) and in good standing under the laws of the place of the accountant’s residence or principal office.
Auditor reports on financial statements that refer to PCAOB standards must comply with the independence rules of both the SEC and the PCAOB.
The SEC’s independence rules are promulgated in S-X 2-01.
In considering this standard, the SEC looks in the first instance to whether a relationship or the provision of a service: (a) creates a mutual or conflicting interest between the accountant and the audit client; (b) places the accountant in the position of auditing his or her own work; (c) results in the accountant acting as management or an employee of the audit client; or (d) places the accountant in a position of being an advocate for the audit client.
In providing the information that Item 304 of Regulation S-K requires regarding a change in accountants for a firm whose registration is revoked by the PCAOB, a company should indicate that the PCAOB has revoked the registration of its prior auditor.
Registrants should consult with CF-OCA prior to filing any S-X 3-10(g) financial statements that are not audited by a PCAOB- registered firm.
The audited balance sheet of a non-issuer general partner that is included in a transactional filing or registration statement of a limited partnership issuer is not required to be audited by a PCAOB registered firm.
The PCAOB has also issued certain independence and ethics rules, which are part of its adopted standards. Compliance with these rules is required to issue a PCAOB opinion.
S-X 2-01 is designed to ensure that auditors are qualified and independent both in fact and in appearance.
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It must include representations that the audit is conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States) for issuers or U. GAAS for non-issuers (with certain exceptions noted in Section 4210.4).