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The AAO Weblog covers accounting issues and current events as they relate the practice of investment analysis. All posts prior to September, 2007 are in the public domain, but after September 4, only subscribers to The Analyst's Accounting Observer will see all posts going forward. Only selected, occasional posts will be released to the public domain from September 4 forward.

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Meet Me In DC
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Posted by: Jack Ciesielski 5/23/2007 6:10 AM
A couple of big meetings this week in the nation's capitol and they both deal with the same thing: the new auditing standard for evaluating internal control to be known (infamously, perhaps) as "Auditing Standard 5."

On Wednesday, it's Item One on the SEC's agenda at its open meeting. On Thursday, the PCAOB will vote on the adoption of the new auditing standard.

The standard is likely to be significantly more relaxed than the oft-reviled Auditing Standard 2. And adapting to it will likely cause revamping of work to be done in the auditing world, even if it requires them to do less. They'll still have to revamp plans and audit programs - so preparers are likely to still complain that they're not seeing the kind of relief they were hoping for. Whether or not it provokes auditors into getting good insights into the operating mettle of control systems will probably be forgotten. (Until there's a major failure.)
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