Audit committees play a vital role in the capital markets' investor protection framework through their oversight of the audit engagement and the company’s financial reporting process. The Sarbanes-Oxley Act of 2002, as amended, enhanced the scope of the oversight role played by the public company audit committee, by, among other things, making audit committees of listed companies “directly responsible for the appointment, compensation, and oversight” of auditors, imposing stricter independence requirements, and promoting increased audit committee expertise in financial reporting matters.
As part of its mission to protect the interests of investors and further the public interest in the preparation of informative, accurate and independent audit reports, the PCAOB is committed to constructive engagement with audit committees in areas of common interest, including auditor independence and audit quality. [PCAOB]
