On October 23, 2017, the Securities and Exchange Commission, or the SEC, unanimously approved new rules and amendments designed to render auditor’s reports more informative to investors. These provisions were proposed by the Public Company Accounting Oversight Board, or the PCAOB, as AS 3101, The Auditor’s Report on an Audit of Financial Statements When the Auditor Expresses an Unqualified Opinion. The Standard marks the first significant change to the auditor’s report in more than 70 years and its adoption proved a flashpoint, with the SEC receiving 50 comment letters on the topic.

The goal of the new auditor’s report is to provide investors with more meaningful information about a company’s audit, including significant estimates and judgments, significant unusual transactions, and other areas of risk. The SEC believes that this new information will add to the total mix of information available to investors when making voting and capital allocation decisions.