Auditing Standards Board - wikipedia Auditing Standards Board This article relies largely or entirely on a single source. Relevant discussion may be found on the talk page. Please help improve this article by introducing citations to additional sources. ( February 2008 ) In the United States, the Auditing Standards Board ( ASB ) is the senior technical committee designated by the American Institute of Certified Public Accountants ( AICPA ) to issue auditing, attestation, and quality control statements, standards and guidance to certified public accountants ( CPAs ) for non-public company audits. Created in October 1978, it is composed of 19 members representing various industries and sectors, including public accountants and private, educational, and governmental entities. It issues pronouncements in the form of statements, interpretations, and guidelines, which all CPAs must adhere to when performing audits and attestations. Contents 1 History 1.1 Prior auditing standards and authorities 1.2 Creation of the ASB 1.3 Sarbanes - Oxley and the PCAOB 2 Current Board membership 3 ASB Meetings 4 Notes 5 Primary sources 6 External links History Prior auditing Standards and authorities The American Institute of Certified Public Accountants has issued guidance to accountants and auditors since 1917, when, at the behest of the U.S. Federal Trade Commission and auspices of the Federal Reserve Board, it issued a series of pamphlets to the accounting community in regard to preparing financial statements and auditing ( then referred to as `` verification '' and later `` examination '' ). Verification of Financial Statements, the first pamphlet dedicated exclusively to providing guidance for audits, was issued in 1929. With its opening paragraph, the guidance provided one of the most fundamental principles in auditing, stating that `` the responsibility for the extent of the ( audit ) work required must be assumed by the auditor. '' In 1936 the AICPA revised its prior pronouncements and issued Examination of Financial Statements by Independent Public Accountants, which contained more detailed guidance on performing audit procedures for audits of small and mid-sized companies, while still emphasizing the need to perform the audit based on the nature of the client, its size, and its internal control structure, among other attributes. On January 30, 1939, the Committee on Auditing Procedure was formed by the AICPA to evaluate, discuss, and issue guidance exclusively on auditing - related matters. This Committee is considered the antecessor of the Auditing Standards Board, and was the first to issue Statements on auditing standards and principles to the public accounting community. In 1941 it issued a pamphlet titled Statements on Auditing Procedure, which discussed the auditor 's responsibility in applying judgment in audits. It was followed by a series of numbered pronouncements called Statements on Auditing Procedures, or SAP ( the antecessors of Statements on Auditing Standards ), issued between 1939 up to the early 1970s for a total of 54 SAP pronouncements. During that time, the Securities Exchange Commission required public accountants to include a representation in their independent audit reports that the audit was performed in compliance with generally accepted auditing standards, and the Committee issued a booklet titled Generally Accepted Auditing Standards -- Their Significance and Scope to adopt the SEC 's requirement. In 1963, the Committee issued Statement on Auditing Procedure No. 33 to consolidate and replace various pronouncements issued between 1949 and 1963, including pamphlets and statements. In 1972, the AICPA implemented significant changes to its standard - setting practices by consolidating all auditing pronouncements up to that date under Statements on Auditing Standards ( SAS ), and gave the Committee the title of senior technical committee on auditing matters while changing its name to Auditing Standards Executive Committee. From 1972 through 1978 the Executive Committee issued SAS as the authoritative guidelines and rules for auditing, issuing a total of 23 SAS. Creation of the ASB In October 1978, following extensive studies by the AICPA and its sub-committees, its governing council established the Auditing Standards Board as the maximum authoritative body in establishing GAAS, thereby consolidating and replacing all previous senior technical committees. It required all AICPA members and public accountants to adhere to the ASB 's pronouncements in relation to audit, attestation, and quality control. The ASB would now define auditor responsibilities and provide guidance to allow them to accomplish work and emit a report, among others. Sarbanes - Oxley and the PCAOB The Sarbanes - Oxley Act of 2002 changed the hierarchy of generally accepted auditing principles and standards. The legislation established that the new Public Company Accounting Oversight Board ( PCAOB ) and the Securities Exchange Commission ( SEC ) now had final authority over auditing regulation and public - auditor professional - practices standards for audits of public companies, also referred to as `` issuers ''. Public accountants and firms who audit public companies were required to register with the PCAOB and follow all standards, principles, rules, and interpretations issued by the PCAOB in regard to public company audits and audit reports, as well as attestation and quality control. The PCAOB adopted the ASB 's auditing and attest standards as its temporary auditing rules in 2003. The AICPA subsequently changed the designation of the leading GAAS - setting authority in February 2004. It designated the PCAOB as the authoritative body for GAAS related to public companies, while the ASB was designated for non-public companies. Current Board membership Current Board Members Board member Representing industry Darrel R. Schubert ( Chair ) Big Four ( Ernst & Young LLP ) Sheila Birch Ciuni & Panichi, Inc. Ernest F. Baugh, Jr. Mayer Hoffman McCann P.C. Brian Bluhm Eide Bailly LLP Robert E. Chevalier Big Four ( KPMG ) Jacob Cohen Walpert and Wolpoff, LLP ( ret. ) David D. Duree Elms, Faris & Company, LLP Charles Frasier Frasier, Dean & Howard Andrew M. Mintzer Sole Practitioner David Morris Morris Consulting Kenneth R. Odom Rabren, Odom, Pierce, & Hayes, P.C. Thomas A. Ratcliffe Wilson Price Brian R. Richson Big Four ( PricewaterhouseCoopers ) Randy C. Roberts Arizona Office of the Auditor General Thomas Stemlar Arthur Andersen LLP ( ret. ) Mark H. Taylor Case Western Reserve University H. Steven Vogel Wilson Elser Moskowitz Edelman & Dicker, LLP Phil D. Wedemeyer Grant Thornton LLP Megan Zietsman Big Four ( Deloitte & Touche ) The Auditing Standards Board consists of 20 members ( see table for current Board members ), each nominated by the Director of the AICPA Audit and Attest Standards Staff and approved by the AICPA Board of Directors. The Board has a Chairman to direct Board meetings and to establish procedures, sub-committees, and perform other similar tasks in conjunction with the Director. To assure that the different industries and sectors are represented, the AICPA has reserved nominations for different industry segments as part of its operating policies : 5 seats for public accounting firms at a local, regional or national level, but are not considered part of the `` Big Four '' accounting firms. 4 seats for Big Four accounting firms 5 seats for representatives of the National Association of State Boards of Accountancy ( NASBA ), including current and former members of State boards of accountancy. 6 seats for other public accountants, members of the AICPA, and financial statement users ( i.e. private industry ). The AICPA typically reserves one of these for a person within the academic community and another for a government official, government auditor, or similar representative. Board members serve a one - year term, after which they are evaluated by the AICPA for their performance, and can then be re-appointed for up to 3 one - year terms, or dismissed by the AICPA. The AICPA may extend the term of service if, for example, the member is working on a long - term project and the AICPA believes that such participation is crucial for the completion of the project. ASB meetings ASB proposed pronouncements are discussed within the ASB membership, the AICPA and with the general public. The ASB meets periodically to discuss auditing issues and prepare and draft pronouncement proposals, and occasionally holds public hearings. The meetings are considered informal ( no set of formal rules ) to encourage open deliberation between its members,. Matters which affect public interest, such as proposals of new SAS, are open to the public. The meetings and hearings are established by the ASB Chair, with public notices and meeting highlights and summaries printed in The CPA Letter, and on the AICPA website. A quorum comprises the majority of ASB members or their representatives, and other members of the AICPA are usually invited also. Proposed pronouncements are discussed in the ASB meetings, and the board members must vote before to issuing a draft proposal ( called an `` exposure draft '' ) or the final version to the public with two - thirds of ASB members in favor. The voting results are included in the meeting highlights published, and any ASB member who dissents from issuing a pronouncement may request that the reasons for dissenting be included in the exposure draft or final pronouncement. Notes Jump up ^ AICPA Operating Policies, pg. 1 ^ Jump up to : Creation of the Auditing Standards Board, AICPA Operating Policies Appendix A, pg. 17, par. 2 - 6 Jump up ^ Historical Background, AICPA Operating Policies Appendix A, pg. 14, par. 2 - 7 and pg. 15, par. 1 - 3 Jump up ^ Historical Background, AICPA Operating Policies Appendix A, pg. 14, par. 4 - 6 Jump up ^ Verification of Financial Statements ( 1929 ), American Institute of Accountants, Introduction, Opening Paragraph Jump up ^ Historical Background, AICPA Operating Policies Appendix A, pg. 15, par. 1 - 2 ^ Jump up to : Historical Background : Statements on Auditing Procedures ; AICPA Operating Policies Appendix A ; pg. 15, par. 4 - 7 and pg. 16, par. 1 - 6 Jump up ^ Historical Background : Statements on Auditing Procedures ; AICPA Operating Policies Appendix A ; pg. 16, par. 7 and pg. 17, par. 1 ^ Jump up to : Changes created by Sarbanes Oxley Act of 2002 ; AICPA Operating Policies pg. 17, par. 7 and pg. 18, par. 1 Jump up ^ Auditing Standards Board Members, AICPA.org ^ Jump up to : Nomination of ASB Members and the ASB Chair, AICPA Operating Policies, pg. 3 ^ Jump up to : Meetings of the Auditing Standards Board ; AICPA Operating Policies ; pg. 8, par. 1 - 5 ^ Jump up to : Meetings of the Auditing Standards Board ; AICPA Operating Policies ; pg. 9, par. 1 - 4 Primary sources Auditing, Attestation, and Quality Control Standards Setting Activities : Operating Policies ( 2004 ), American Institute of Certified Public Accountants External links American Institute of Certified Public Accountants Retrieved from `` https://en.wikipedia.org/w/index.php?title=Auditing_Standards_Board&oldid=839030903 '' Categories : Auditing in the United States Hidden categories : Articles needing additional references from February 2008 All articles needing additional references All articles with dead external links Articles with dead external links from October 2016 Articles with permanently dead external links Talk Contents About Wikipedia Svenska Edit links This page was last edited on 30 April 2018, at 20 : 20 ( UTC ). 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Question: the aicpa auditing standards board (asb) sets auditing standards for audits of
Answer: non-public company