Updated PCAOB Staff Guidance on Determining Auditor Tenure

By | January 5, 2018

Updating a previous thread: per a PCAOB spokeswoman, the last two paragraphs on page 4 of the staff guidance provide a bit more clarity to calculating auditor tenure after firms expressed some confusion.

If auditors cannot readily determine when an initial engagement letter was signed,they can determine tenure based on their own records, the company’s records, or publicly  available  information,  such  as  company  filings available  on  the  SEC’s Electronic Data Gathering, Analysis and Retrieval (“EDGAR”) system.

In  the  absence  of  other  evidence  about  when  the  auditor  signed  an  initial engagement   letter   or   began   performing   audit procedures,   tenure   can   be determined based on the year in which the auditor first issued an audit report on the  company’s  financial statements  or,  if  earlier,  the  auditor’s estimate  of  when work would have commenced to enable the issuance of such report.