Audit Board to Examine Quality Safeguards at PE-Backed Firms (1)

The US audit regulator will scrutinize safeguards meant to deliver effective audits as part of routine inspections of private equity-backed accounting firms, an agency official said Tuesday.

Outside ownership introduces threats that could undermine auditor independence and weaken firm culture. Profit pressures could reduce audit team staffing and other resources, said Christine Gunia, inspections director for the Public Company Accounting Oversight Board.

Board staff will focus on those and other risks during inspections of firms that have cut PE deals and those considering such investments, Gunia said at an American Institute of CPAs conference in Washington. Those reviews will ...