The PCAOB has adopted new rules and accompanying amendments to auditing standards, which require audit firms to disclose the names of each audit engagement partner, as well as information regarding other audit firms that participated in any audit of a public company. The new rules are intended to provide investors with more information about the partner and firms involved in the audit in order to facilitate evaluating audit quality, and to incentivize auditors to organize audit teams carefully.
The new rules will require auditors to file with the PCAOB a new Form AP, Auditor Reporting of Certain Audit Participants, for each issuer audit, disclosing:
- The name of the engagement partner;
- The names, locations, and extent of participation of other accounting firms that took part in the audit, if their work constituted 5% or more of the total audit hours; and
- The number and aggregate extent of participation of all other accounting firms that took part in the audit whose individual participation was less than 5 percent of the total audit hours.