The Public Company Accounting Oversight Board was designed to keep a close eye on auditors, ensuring that their reports are informative, fair, and independent. But even the PCAOB must open up its books sometimes.
This month it did so, as the board’s Internal Oversight and Performance Assurance unit issued its report on the PCAOB’s effectiveness. Examining 37 inspections, IOPA found that although the PCAOB gets results, its new $1.3 million document-management system (DMS) seems to be failing.
The review found concerns that DMS was “cumbersome” and “slow” and that inspection teams often found ways to work around using the system when filing their data. DMS is the board’s automated tool for documenting large-firm inspections.
Using the implement proved to be a roadblock. “DMS was considered a hindrance to timely completion of inspections work rather than a tool that facilitated Division objectives,” according to the review.
Because of poor network connections and slow response times, some routine tasks get duplicated and become burdensome, the review said. The system was also slow to archive data for future analysis. “As a result, Inspections DMS is unlikely to fully achieve the objectives set out for it, and the PCAOB may not realize all the potential benefits of its $1.3 million investment,” the report said.
The IOPA recommended that the board consider potential alternatives to the system.