The Future of the Audit Committee: Expanded Critical Audit Matters, Reporting, Disclosure, and Accounting Changes

As corporations face more complex and interconnected risks in today’s global economy, the responsibilities and workload of the audit committee has continued to expand and become ever more complicated. On top of that general trend, there are significant potential changes to auditing standards, financial reporting, and disclosure rules that audit committee members need to have on their radar screens. The Public Company Accounting Oversight Board (PCAOB) has been critical of audit quality and recently levied the largest penalty in its history. Meanwhile, the Financial Accounting Standards Board (FASB) has issued proposals to disaggregate the income statement and to mandate tax transparency. And the Securities and Exchange Commission (SEC) adopted rules requiring enhanced disclosures for climate and cybersecurity risk and oversight. Moreover, the SEC may soon propose additional human capital disclosures, heeding calls to provide more information to investors about what has become the most valuable asset at many companies with the rise of the “human capital firm.” This session will discuss best practices for how audit committee members can keep up with these expanded responsibilities and calls for increased transparency and prepare for changes to accounting, reporting, and disclosure obligations that will fall under the audit committee’s oversight.