PCAOB Adopts New Rules for Scrutiny of Related Party and Similar Transactions

19 June 2014
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  • The PCAOB last week adopted new Auditing Standard No. 18 and related amendments, which are intended to strengthen audit procedures relating to the risks of misstatement arising out of a company‚Äôs related party transactions, significant unusual transactions and financial relationships and transactions with executive officers.
  • Companies can expect a more rigorous examination of their identification of and accounting for related party and similar transactions by their auditors as well as increased communications with audit committees.
  • The new standard and related amendments will be effective, subject to SEC approval, for audits of financial statements for fiscal years beginning on or after December 15, 2014.