PCAOB on Auditing Supplemental Information Results

Question 1

The auditor’s report on supplemental information under PCAOB auditing standards should include a statement about each of the following except for
A statement that the supplemental information is management’s responsibility.
A statement that the methods of measurement and presentation have not changed from those used in the prior period.
A statement that the supplemental information complies with the applicable regulatory requirements.
An opinion (or disclaimer) as to whether the supplemental information is fairly stated in relation to the financial statements as a whole.

Answer 1

A statement that the methods of measurement and presentation have not changed from those used in the prior period.

The auditor should obtain management’s representation that the methods of measurement or presentation have not changed from those used in the prior period. However, the auditor’s report does not include such a statement.

Question 2

In reporting on supplemental information under PCAOB auditing standards, the auditor’s procedures should include each of the following except for
Obtain an understanding of the purpose of the supplemental information and the criteria used by management for its preparation.
Inquire of management about any significant assumptions or interpretations underlying the presentation of the supplemental information.
Obtain written confirmation from the regulatory authorities that the supplemental information complies with regulatory requirements.
Verify that the supplemental information reconciles to the underlying accounting or other records of the entity.

Answer 2

Obtain written confirmation from the regulatory authorities that the supplemental information complies with regulatory requirements.

The auditor should obtain management’s representation that the supplemental information complies with the applicable regulatory (or other) criteria, and the auditor should evaluate whether the information is presented in conformity with the regulatory criteria. However, a written confirmation from the regulatory authority would not be obtained.

Question 3

The definition of “supplemental information” under PCAOB auditing standards includes all of the following except for
A public company’s sustainability report consisting of a variety of financial and nonfinancial measures of performance, which is made available to readers on the entity’s web site.
Supporting schedules that brokers and dealers are required to file with the Securities and Exchange Commission.
Information outside of the financial statements that is derived from the entity’s accounting records, which is covered by the auditor’s report in relation to financial statements audited under PCAOB auditing standards.
Information that is required to be presented under the rules of a regulatory authority, which is covered by the auditor’s report in relation to financial statements audited under PCAOB auditing standards.

Answer 3

A public company’s sustainability report consisting of a variety of financial and nonfinancial measures of performance, which is made available to readers on the entity’s web site.

Information that a company voluntarily presents on its web site is outside the PCAOB’s definition of “supplemental information.” As a practical matter, sustainability reports are not required, nor is third-party assurance on sustainability required.