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AS 3101 PCAOB Critical Audit Matters Disclosure Requirements: New Rules for Public Company Audits

Identifying CAMs, Implementing Processes and "Dry Run" Tests, PCAOB Guidance

Recording of a 110-minute CPE webinar with Q&A

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Conducted on Thursday, July 25, 2019

Recorded event now available

or call 1-800-926-7926

This course will provide audit professionals with a critical first look at the new critical audit matters (CAM) disclosure requirements issued by PCAOB, effective for large accelerated filers with June 30, 2019, fiscal year-ends. The panel will discuss the determinations necessary to identify CAMs, detail early guidance by PCAOB and the Center for Audit Quality, and describe "dry run" testing and initial implementation tools.


The requirement for auditors to disclose CAMs, beginning with fiscal years ending on or after June 30, 2019, for audits of large accelerated filers and Dec. 15, 2020, for all other companies, continues to create anxiety for auditors. While the new disclosure requirements will impact audits of public companies, audits of nonpublic companies that have audits performed in accordance with PCAOB standards will need to apply the standard.

In June 2017, the PCAOB adopted new audit standard AS 3101, The Auditor's Report on an Audit of Financial Statements When the Auditor Expresses an Unqualified Opinion. The new standard requires auditors to switch from a "pass/fail" reporting approach to one that exercises judgment in disclosing matters that involved especially challenging, subjective, or complex auditor judgment. AS 3101 provides factors to assist the auditor in determining and describing CAMs. PCAOB has recently issued guidance to assist auditors in implementing the new guidance, and many firms have engaged in "dry runs" to test their CAM disclosure processes.

The Auditing Standards Board (ASB) recently issued Statement on Auditing Standards No. 134, Auditor Reporting and Amendments, Including Amendments Addressing Disclosures in the Audit of Financial Statements, which, among other things, introduces reporting Key Audit Matters (KAMs) in auditor’s reports for audits conducted under auditing standards generally accepted in the United States. SAS No. 134 will be effective for audits for fiscal years ending on or after Dec. 15, 2020. However, reporting KAMs in the auditor’s report will be optional and will apply only when the auditor is engaged to report on KAMs. Auditors of nonpublic companies will also need to grasp the new CAM requirements to comply with ASB standards.

Listen as our experienced panel provides a practical guide to the new CAM reporting requirements.



  1. CAM identification criteria
    1. Essential matters to communicate to audit committee
    2. Accounts or disclosures material to financial statements
    3. Requiring subjective or complex independent judgment on the part of the auditor
  2. PCAOB and CAQ guidance
  3. Suggested reporting formats
  4. Implementation timetable
  5. Application to audits of nonpublic companies
  6. Dry runs and implementation challenges


The panel will discuss these and other critical topics:

  • Effective processes for identifying CAMs
  • How CAM requirements differ from key audit matters (KAM) concepts used in international audit standards and to be used on audits of nonpublic companies in the US
  • What guidance has the PCAOB and CAQ issued in helping auditors adjust to the new reporting paradigm?
  • Conducting "dry runs" of CAM identification and reporting


Catherine M. (Cathy) Clarkin

Sullivan & Cromwell

Ms. Clarkin is a partner in Sullivan & Cromwell’s Capital Markets and Financial Institutions Groups and is...  |  Read More

Wei, Jessie
Jessie X. Wei
Senior Manager
Ernst & Young

Ms. Wei is a senior manager on EY’s Americas Professional Practice team. She helps develop tools and guidance to...  |  Read More

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