Wiley Practitioner's Guide to GAAS 2013: Covering all SASs, SSAEs, SSARSs, and Interpretations

PCAOB 4: Reporting on Whether a Previously Reported Material Weakness Continues to Exist1

IMPORTANT NOTE: The guidance in this section applies to the preparation and issuance of audit reports for all issuers as defined by the Sarbanes–Oxley Act.

EFFECTIVE DATE AND APPLICABILITY

Effective Date	This standard currently is effective.
Applicability	Engagements designed specifically to test for the continuing presence of previously reported material weaknesses.

DEFINITIONS OF TERMS

Control objective. Provides a specific target for the evaluation of the effectiveness of controls. When used in relation to controls over financial reporting, it states a criterion for evaluating whether an entity’s control procedures provide reasonable assurance that a misstatement to or omission in that assertion is prevented or detected by controls on a timely basis.

Stated control objective. The specific control objective identified by management that, if achieved, would result in a material weakness no longer existing.

OBJECTIVES OF PCAOB STANDARD 4

Public Company Accounting Oversight Board (PCAOB) Auditing Standard 4 sets forth the general requirements for an auditor who is engaged to report on whether a previously reported material weakness in internal control over financial reporting continues to exist.

FUNDAMENTAL REQUIREMENTS

Basic Requirement

An auditor may report on whether a previously reported material weakness continues to exist if the auditor has audited the company’s financial ...