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Your year-end audit committee guide
Everything you need to walk into your next meeting with confidence
The responsibilities of the audit committee are significant and continue to expand. As year-end approaches, our guide can help you streamline meeting prep and confirm emerging matters get the appropriate agenda time.
Let’s get started...
It’s been a year of change, from the presidential election to standard setting, SEC happenings and more. As you navigate what it all means for the companies you oversee, we’ve boiled the ocean down to eight timely topics that are likely to come up as you close out the year and move into Q1:
- A tax policy outlook
- SEC comment letter trends
- Overseeing fraud risk in uncertain times
- Compliance with laws and regulations
- Audit committee effectiveness
- FASB standard setting developments
- New internal audit standards on the horizon
- Enhancing proxy disclosure
What do you need to know about each of these topics, and what are some smart questions to ask about each at your next audit committee meeting? Read on to learn more.
Hot audit committee topics for year-end and going into 2025
With President-elect Trump taking office soon, tax policy is again at the top of many executives’ and boards’ priorities. With Republicans winning majorities in the House and the Senate, a unified Republican government will provide President-elect Trump an opportunity to pursue some of the tax and trade policies he proposed during his campaign.
Non-GAAP measures have consistently remained the top focus, mirroring the trend we saw during the same period last year. Following closely behind are Management's Discussion and Analysis (MD&A) and segment reporting, which took second and third place, respectively.
Since the audit committee is charged with oversight of management’s fraud prevention program, it may want to add focus to this area given the continuing volatile and evolving business environment. Confirming an understanding of the robustness of management's anti-fraud programs and processes should be a keen focus area.
Governments and regulatory bodies worldwide are increasingly focused on corporate accountability and transparency, leading to the introduction of new regulations and the tightening of existing ones across various sectors. There are key challenges for companies, particularly multinationals operating in various jurisdictions across the globe (e.g., data privacy and protection regulations, evolving cybersecurity standards).
We often hear about the audit committee’s challenge of staying efficient and effective while taking on more and more responsibilities. This is a great time of the year for an audit committee to consider taking a fresh look at its oversight responsibilities and annual agenda plan.
The segment reporting standard issued last year is effective for 2024 calendar year-end companies. In early November, the FASB issued a new standard on its disaggregation of income statement expenses (“DISE”) project. In addition, the FASB has continued to move forward several other projects and is expected to initiate an agenda consultation process in early 2025.
In January 2024, the IIA issued new Global Internal Audit Standards, which will become effective on January 9, 2025. The Standards aim to help internal auditors define and fulfill their mandate and provide a framework of principles, requirements, considerations, and examples for the professional practice of internal auditing globally.
Audit committee disclosure in the proxy has continued to progress in response to stakeholder expectations for enhanced transparency. In recent years, audit committees have expanded disclosure across a number of areas, including oversight of the external auditor, cybersecurity, and ESG. Audit committees have an opportunity to continue to drive enhanced disclosure even further.
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