Auditors are confronting significant challenges as they focus on maintaining audit quality during the coronavirus pandemic. Below are some of the issues those firms are reporting.
Working in a virtual environment: Although the coronavirus pandemic is still evolving, the audit profession is continuing to focus on the safety and well-being of its employees. Working remotely makes their job more difficult, but they are adapting and maintaining high standards of quality and professional skepticism while working in a virtual environment.
Internal controls over financial reporting: Some business locations have closed, employees are working remotely, and employees have been furloughed. But the existing requirement for company officers to assess changes and certify the effectiveness of their ICFR in each annual and quarterly report has not changed.
Going concerns: Public companies of all sizes are facing evaluation of going concern for the first time as a result of the coronavirus. Certain businesses, like retail and hospitality, are facing challenges they have never seen before. For many calendar year-end companies, their year-end 2019 and first-quarter 2020 reporting included little or no significant impacts of COVID-19. But as the economic challenges continue, it is likely that more companies and their auditors will need to evaluate and report on going concern in subsequent periods during this year.