In a letter to the Public Company Accounting Oversight Board (PCAOB), NAREIT said the board has not made “a compelling argument for why critical audit matters are needed in the auditor’s report or how such a requirement would enhance the usefulness of the audit report for financial analysis purposes.”
NAREIT submitted its comments to the PCAOB on Aug. 10 regarding Proposed Auditing Standards – The Auditor’s Report on an Audit of Financial Statements When the Auditor Expresses an Unqualified Opinion and Related Amendments to PCAOB Standards (PCAOB Release No. 2016-003, May 11, 2016, PCAOB Rulemaking Docket Matter No. 034).
NAREIT recommended that the board suspend its work on the proposal because NAREIT does not believe that the changes recommended by the proposal with respect to the audit report and disclosure of auditor tenure are warranted. These requirements would add costs without improving the quality of the audit. Furthermore, these proposals would be likely to confuse and in some cases even mislead users of financial statements.
(Contact: Chris Drula at cdrula@nareit.com)