backOn January 30, 2024, the PCAOB Staff released a spotlight report providing insights from the Staff’s inspection of broker-dealer audits. The Staff report highlights common causes of audit deficiencies in broker-dealer audits, including insufficient understanding of the broker-dealer industry by audit teams and engagement quality reviewers, lack of professional skepticism with respect to management inquiries and when responding to identified fraud risks, lack of rigor in assessing broker-dealers’ internal control over financial reporting when assessing the risks of material misstatement, and overreliance on standardized audit programs. The Staff report also includes reminders for auditors performing broker-dealer audit and attestation engagements under PCAOB standards.
The report can be found here.