Which standards govern audit engagements for CPA firms working with issuers?

The standards that govern audit engagements for CPA firms working with issuers, specifically those whose securities are registered with the Securities and Exchange Commission (SEC), are the Statements on Auditing Standards (SAS) and the standards set by the Public Company Accounting Oversight Board (PCAOB).

The SAS provides the general auditing standards and guidelines for auditors in conducting audits. These standards ensure that auditors maintain objectivity, integrity, and professional skepticism throughout the audit process. The PCAOB standards complement the SAS specifically for public companies, establishing additional requirements to enhance the quality of audits and protect investors. The PCAOB’s oversight includes periodic inspections of registered public accounting firms, focusing on compliance with these specific standards in audits of issuers.

While other standards like SSARS, which are relevant for non-public entities, and SSAE, which applies to assurance engagements, have their importance, they are not applicable to audit engagements for public companies. AFR (Annual Financial Report) is not a standard governing audits but rather a type of report.