CAQ WEBCAST
PCAOB Insights on Internal Control: A
Discussion on
Auditing Standard No. 5
The views expressed by the presenters do not necessarily represent the views, positions, or opinions of the Center for Audit Quality or the presenters’ respective organizations. These materials, and the oral presentation accompanying them, are for educational purposes only and do not constitute accounting or legal advice or create an accountant-client or attorney-client relationship.

Slide 1

Join the CAQ today!
Visit www.thecaq.org/members
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1-888-817-3277

Slide 2

Today’s Objectives
Today’s program is designed to help you better
understand:
 Notable changes made to the PCAOB’s
internal control auditing standard no. 2
 Overview of AS 5 and insights on how it can
be scaled for smaller, less complex companies
 Overview of SEC’s Management Guidance on
Internal Control
 Overview of COSO’s Guidance on Monitoring
Internal Control

Slide 3

Today’s Presenters
Thomas Ray, CPA
Chief Auditor and Director of Professional Standards
PCAOB

Sharon Virag, CPA
Director of Technical Policy Implementation
PCAOB

Trent Gazzaway, CPA
Managing Partner of Corporate Governance
Grant Thornton LLP
**********

Cynthia M. Fornelli
Moderator & Executive Director
Center for Audit Quality

Slide 4

CAQ Webcast

PCAOB Insights on
Internal Control:
A Discussion on Auditing
Standard No. 5
Tom Ray
Sharon Virag
5

October 4, 2007

Caveat
The views expressed by Mr. Ray and
Ms. Virag are their own views and do
not necessarily reflect the views of the
Board, individual Board members, or
other members of the staff of the
PCAOB.

6

Overview

7



Improvements resulting from
Auditing Standard No. 5



Successful implementation of
AS No. 5 - Next steps

Improvements
Resulting from the
Amendment to Auditing
Standard No. 2

8

Improvements Resulting from Auditing
Standard No. 5

9



Focus the internal control audit on
the most important matters



Eliminate procedures that are
unnecessary to achieve the intended
benefits



Make the audit clearly scalable to fit
any company’s size and complexity



Simplify the standard

Focus the Internal Control Audit on the Most
Important Matters

10



More clearly focuses auditors on
identifying control w...

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