Broker-dealer auditors continue to show “high levels” of deficiencies, with Public Company Accounting Oversight Board inspectors citing deficiencies at 97% of the firms inspected in 2016, a slight rise from the 96% in 2015, according to PCAOB’s just-released annual 2016 review.
The annual report, the sixth issued by the PCAOB for its interim inspection program for auditors of broker-dealers, covers the 2016 inspections of 75 firms and portions of 115 audits and related attestation engagements.
The Dodd-Frank Act amended the Sarbanes-Oxley Act to, among other things, give the PCAOB oversight authority for the audits of broker-dealers registered with the Securities and Exchange Commission.
Deficiencies were observed in the audits at 73 of the 75 firms inspected during 2016, or 97%, the report said, which was comparable to the 96% observed from inspections during 2015. In addition, deficiencies were observed in 96 of the 115 audits covered by the 2016 inspections, or 83%, up from 77% in 2015.