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Washington, D.C., (Dec. 5, 2016) – CPAs, financial executives, regulators and academics must remain relentless in their efforts to drive quality and trust throughout our financial system, Kimberly Ellison-Taylor, CPA, CGMA, chairman of the American Institute of CPAs’ (AICPA) Board of Directors, told attendees at the AICPA Conference on Current SEC and PCAOB Developments today.
“Quality and trust are cornerstones of the CPA profession and the touchstones for all of us in this room. We share a common purpose: driving confidence in business, the markets, and ultimately, our economy,” Ellison-Taylor remarked.
She highlighted four initiatives – cybersecurity, audit quality, management accounting and talent – that she said underscore the power of collaboration.
“We have reached an inflection point on cyber threats,” Ellison-Taylor said. “Organizations need a structured, consistent way to assess, understand and communicate these risks to their stakeholders, and to establish and test governance and controls. CPAs – in both management and public accounting – are uniquely qualified to lead in this area.” In September, the AICPA issued two criteria proposals that will help management communicate more consistently and effectively on how they are managing cybersecurity risk. These criteria proposals pave the way for the creation of a new cybersecurity attestation engagement that CPAs can perform to assist boards of directors, senior management, and other stakeholders. The AICPA is also developing an attestation performance and reporting guide so auditors of an organization will be able to report on management’s description of their cybersecurity risk management program, as well as on the operating effectiveness of controls designed to mitigate and react to cyber risks. The authoritative guide is being developed by the AICPA’s Assurance Services Executive Committee and the Auditing Standards Board and will be delivered early next year.
Audit quality has been a focus around the world for several years, given the increasingly complex and fast-changing business environment, said Ellison-Taylor. “In response, we introduced a Six-Point Plan as part of a new Enhancing Audit Quality initiative. While the plan focuses on audits of private entities, governments and benefit plans, it also impacts audits of listed entities. It provides a roadmap for the auditor’s journey, from education and pre-licensure, to performance, training and monitoring.” She noted that the profession is working to boost quality through research, guidance and tools aimed at advancing the audit through the greater use of audit analytics in both public and private company audits.
Ellison-Taylor then turned to what she called the other side of the quality equation – management accounting – the work that CFOs, finance directors, and controllers perform within an organization to protect its financial standing and move it forward. “As businesses contend with unprecedented volumes of data, they’re looking to management accountants to connect the dots across functions and turn relevant information into insight that creates value for the organization. That requires new ways of thinking and doing. To help, the AICPA and [the Chartered Institute of Management Accountants (CIMA)] created Global Management Accounting Principles.”
Over the coming months the AICPA and CIMA will introduce new tools to help organizations implement the principles to make better decisions, respond appropriately to the risks they face and protect the value they generate. “We also will be broadening access to our Chartered Global Management Accountant – or CGMA – designation within the United States. This is the foundation of our efforts to elevate the quality of management accounting,” Ellison-Taylor said.
Finally, the AICPA has a long commitment to building the talent pipeline and attracting the best and brightest to the profession. “We have several initiatives designed to reach the next generation, including our ‘This Way to CPA’ campaign, campus champions program and our Accounting Doctoral Scholars project,” she explained. “We also keep a firm hand on the pulse of the evolving skills that CPAs need to meet their responsibility to the public interest. To that end, we will launch the next version of the Uniform CPA Exam in April, which will place greater emphasis on higher-order cognitive skills such as critical thinking, problem solving, and analytical abilities.”
“This conference brings together so many diverse professionals – auditors, financial executives, regulators and academics – to focus on how we continue to drive quality and trust throughout our financial system,” Ellison-Taylor said. “And our work, collectively, has never been more important. The rigor that we put into challenging, clarifying and communicating information and insight is a critical counterforce to the complexity that can erode investor and public confidence.”
The AICPA Conference on Current SEC and PCAOB Developments is an intensive three-day, high-level event that provides the forum for attendees to absorb new regulatory issues, and how they will affect audits, reporting and governance for public companies. It is being held at the Marriott Wardman Park Hotel in our nation’s capital, simulcast in New York and available online.