The Canadian Public Accountability Board (CPAB) published its 2024 Annual Inspections Report, showing a year-on-year decline in significant inspection findings across audit files reviewed and outlining newly implemented transparency measures that expand how inspection outcomes are shared with audit committees and the public. CPAB inspected 131 audit files and identified significant findings in 31 files, a 24% findings rate compared with 34% in 2023. The four largest firms recorded a 12% findings rate (eight of 65 files), although one firm remained elevated at 30% and faced enforcement action due to unacceptable levels of significant findings over consecutive years. Other annually inspected firms improved to 17% (six of 36 files), while non-annually inspected firms continued to show a high findings rate of 57% (17 of 30 files), with new enforcement actions imposed on two firms and one firm terminated for non-compliance with prior enforcement actions. The report also notes seven financial statement restatements since the prior annual report linked to CPAB inspection findings, an increase in significant findings in financial services audits, and continued constraints on access to component auditor working papers in China due to the absence of an agreement with Chinese authorities. CPAB confirmed that amended disclosure rules took effect on March 24, 2025, requiring mandatory communication of reporting issuer-specific significant findings to the issuer’s audit committee and enabling publication of an individual public inspection report for each inspected audit firm; inspections beginning after that date fall within the new regime, with first inspection reports expected in Q1 2026. Decisions on escalation, modification, or termination of certain existing enforcement actions are scheduled for 2025, alongside planned supervisory focus on audit use of emerging technologies including artificial intelligence, fraud-related work, and ongoing climate thematic review activity.
Canadian Public Accountability Board 2025-04-01
Canadian Public Accountability Board reports 24% significant findings rate in 2024 inspections and implements expanded disclosure rules
The Canadian Public Accountability Board (CPAB) released its 2024 Annual Inspections Report, noting a decline in significant inspection findings and introducing new transparency measures. The report highlights a 24% findings rate across 131 audit files, with enforcement actions against firms showing high findings rates. Amended disclosure rules effective March 24, 2025, mandate communication of significant findings to audit committees and allow public inspection reports for each firm.