Expert Panel Projects
- A summary of audit, attestation and independence standards applicable to AICPA members performing audit and attestation engagements for certain SEC and/or CFTC-registered entities
- Illustrative examples of compliance report and exemption report required by the SEC Rule 17a-5.
- November 2014 - The Center for Audit Quality (CAQ)/AICPA joint member Independence Alert that provides audit firms with an overview of SEC and PCAOB independence rules applicable to financial statement audit and attestation engagements for the following non-issuers:
- Non-issuer broker-dealers that are registered with the SEC as a broker or dealer; and
- Where the engagement(s) is subject to the requirements of Custody Rule, SEC-registered and state registered investment advisers, related party custodians, or private funds (e.g., pooled investment vehicles).
- June 2014 - CAQAICPA joint Member Alert outlining regulatory changes that are applicable to audits and attestation engagements of Brokers and Dealers (BDs) and Futures Commission Merchants (FCMs), including those entities that are dual-registered.
- November 2013 - webinar “Broker-Dealer Update”, covering final amendments to SEC Rules 17a-5 and 17a-11 and new PCAOB attestation and auditing supplemental information standards for broker-dealer audits. Presentation slides are available.
Securities and Exchange Commission
- Electronic Filing of Broker-Dealer Annual Reports
- January 2017 - The SEC Office of Compliance Inspections and Examinations announced its 2017 examination priorities for investment advisers and investment companies, broker-dealers, transfer agents, clearing agencies, private fund advisers, national securities exchanges, and municipal advisors.
- The staff of the SEC Division of Trading and Markets has issued staff guidance (in the form of FAQs). To read FAQs, issued in April 2014, about the amendments to Rule 17a-5 and Form Custody, click here. For FAQs, issued in March 2014, concerning certain broker-dealer financial responsibility rules, click here. Other FAQs published by the staff of the SEC Division of Trading and Markets are available here.
- In July 2013, the SEC issued two final rules that affect broker-dealers registered with the SEC and their auditors. One rule adopts amendments that would increase protections for investors whose cash and securities are held by broker-dealers registered with the SEC. These amendments to SEC Rule 17a-5 require, in part, that the audits of broker-dealers' financial statements and supplemental information, as well as the auditor's examination of the compliance report or the auditor's review of the examination report, be conducted in accordance with PCAOB standards for fiscal years ending on or after June 1, 2014.
Public Company Accounting Oversight Board
U.S. Commodity Futures Trading Commission
- December 2016 - Auditing Information Produced by Service Organizations
- Relevant information from recent PCAOB webinars that may be of interest to broker-dealers and their auditors are available:
- August 2016 - PCAOB issued the fifth annual report on the Progress of the Interim Inspection Program Related to Audits of Brokers and Dealers and accompanying Fact Sheet. The report covers inspections conducted in 2015, the first inspection year in which audits of SEC-registered broker-dealers have been performed under the PCAOB standards.
This report cites high levels of audit deficiencies, similar to prior year’s inspection results. Independence continues to be a focus area. The report also states that the PCAOB staff is working to develop a rule proposal for the Board to consider during 2016 to establish a permanent inspection program, which will address, among other matters, whether to exempt any category of registered public accounting firm. Under the interim inspection program adopted in 2011, the PCAOB inspects audit engagements of all types of SEC-registered broker-dealers.
- July 2016 - PCAOB issued a Staff Inspection Brief which contains information about 2016 Inspections of Auditors of Brokers and Dealers.
- The PCAOB announced the dates for 2016 forums on auditing smaller broker-dealers. The SEC staff's recent presentation at the recent forum is available here.
- January 2015 - PCAOB Reports Deficiencies in Broker-Dealer Audits under PCAOB Standards
- Slides from recent PCAOB webinars that may be of interest to broker-dealers and their auditors are available:
- Until the PCAOB announces the scope of their permanent inspection program, audits of broker-dealers will be subject to both PCAOB inspection and AICPA peer review. Peer reviewers are regularly identifying audits where the firm failed to comply with SEC independence rules by preparing the firm’s financial statements, which is consistent with the PCAOB interim inspection program findings. Read more on this topic and other peer review implications for broker dealer engagements.
- June 2014 - PCAOB released staff guidance for auditors of SEC-registered brokers and dealers.
- In October 2013, the PCAOB adopted two attestation standards pertaining to audits of brokers and dealers and an auditing standard, which is applicable when auditors are engaged to perform audit procedures and report on supplemental information that broker-dealers and others file with the SEC. These standards are effective for fiscal years ending on or after June 1, 2014.
- In November 2013, the CFTC approved a final rule on enhancing customer protections, which, in part, will require audits of futures commission merchants (FCMs) to be performed in accordance with PCAOB standards by a PCAOB-registered firm that “must have undergone a PCAOB inspection”. Find out more.
Securities Investor Protection Corporation
- March 2016 - SEC approved SIPC Rule 600, Rules Relating to Supplemental Report of SIPC Membership. These rules now prescribe the form and content of the SIPC supplemental report and require that a registered broker-dealer must file a report with SIPC, and no longer with the SEC. The SIPC maintains Member FAQs where member firms and their auditors can find information regarding SIPC forms, membership, and how and where to file reports. For more information, click here.