This section addresses making reference to the audit of a component auditor in the auditor’s report on group financial statements. Nonissuers – are private companies (nonpublic) and they are subject to Statement on Auditing Standards (SAS), which are set forth by the AICPA. Omnibus Statement on Auditing Standards2013. The standard setting body for SAS is the AICPA Auditing Standards Board. The Statement on Auditing Standards (SAS) describes generally accepted auditing standards for audits of nonissuers. In addition, these standards provide guidance for other nonissuer services such as specific reports to nonissuers as well as interim financial statements for nonissuers. Issuers – are public companies that must file their financial statements with the SEC, and they are subject to auditing standards set forth by the Public Company Accounting Oversight Board (PCAOB).
The standard setting body for the PCAOB is the Public Company Accounting Oversight Board (created by the SEC). This will provide guidance for audits of annual historical financial statements, special reports, and interim financial statements. The American Institute of Certified Public Accountants (AICPA) sets the Generally Accepted Auditing. The Public Company Accounting Oversight Board (PCAOB) provides generally accepted auditing standards for issuers. Whereas nonissuers are defined as nonpublic companies (private companies) and audit engagements for these entities must be in compliance with the AICPA’s Auditing Standard Board’s Statements on Auditing Standards (SAS).
In addition, audit engagements of issuers must follow standards stated by the Public Company Accounting Oversight Board (PCAOB). Issuers are defined by the Securities and Exchange Commission (SEC) as entities that must file or register their financial statements with the SEC. When conducting audit, auditors will either be performing their engagement on issuers or nonissuers.