After encountering heavy resistance from the public and action from the House of Representatives, the PCAOB has finally dropped its project pushing auditor rotation. On February 5, James Doty, PCAOB Chairman, informed members of the SEC that the board no longer has an active project regarding a term limit for auditors. Research by the PCAOB showed that for certain industries, the choice of audit firms with suitable expertise may be too limited to make rotation feasible. Ultimately, it’s possible that skill and knowledge of a company’s complexities trumps any benefit of a new, but potentially uninformed, set of eyes.
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