Study finds continuing auditor deficiencies

Section 104(b) of Sarbanes-Oxley requires that accounting firms that provide audit reports for more than 100 issuers must be inspected annually. The rule was intended as a check on the audit firms, to essentially hold their feet to the fire in order to enhance the quality of the audit process. 

So how are the big auditors doing? The PCAOB just released a report that found "deficiencies in important audit areas, both established and emerging. These areas include critical and high-risk parts of audits, such as revenue, fair value, management's estimates, and the determination of materiality and audit scope." However, auditors are doing better when it comes to confirmation of AR and income tax accounts.

For more:
- here's the report

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Public Company Accounting Oversight Board (PCAOB) news from FierceSarbox