Revising AS2 is the PCAOB's top priority

It's no surprise that reformulating Auditing Standard No. 2 is the PCAOB's highest priority when it comes to setting standards. The board had already submitted a set of proposals to the SEC, a move that many of you see as way too late but still a step in the right direction. These proposed revisions have not yet been made public but that will happen, probably sooner rather than later. That will give the industry a chance to comment. Look for enhanced definitions of "significant deficiency,"  "material weakness" and "materiality." This is not the only standard-setting area that the PCAOB is considering. It will likely also tinker with rules governing reporting, reviewing (by a second partner) and the entire risk assessment process. The short take is that there will be plenty to keep you busy in 2007.

For more on this:
- Here's an update from CFO.com