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Glossary/Tax and regulatory

PCAOB vs AICPA standards (issuer vs nonissuer)

Auditors of SEC issuers follow PCAOB standards and must be PCAOB-registered, while auditors of nonissuers, such as private companies and most nonprofits, follow AICPA standards and AU-C sections.

CORAA TeamUpdated November 5, 2026

Definition

An issuer is generally a company that files reports with the SEC under the securities laws. The Public Company Accounting Oversight Board (PCAOB), created by the Sarbanes-Oxley Act of 2002, sets auditing and related standards for audits of issuers and of broker-dealers, and inspects registered firms. Nonissuers include private companies and most nonprofits. Their audits follow AICPA standards set by the Auditing Standards Board.

Why it matters in an audit or review

The two regimes differ in standard names, report content, and inspection. PCAOB audit reports include critical audit matters for most issuers (not emerging growth companies, broker-dealers and certain other entities), and an audit of internal control over financial reporting is required for accelerated and large accelerated filers. AICPA reports follow AU-C 700. A firm cannot audit an issuer without PCAOB registration, and the AICPA peer review applies to nonissuer work.

Example

Illustrative: a firm with only private clients is hired by a company that plans an IPO. The firm must register with the PCAOB and meet PCAOB independence rules before auditing the issuer financial statements.

Common mistakes

Assuming an audit report issued under AICPA standards can support an SEC filing without PCAOB compliance.

FAQ

Which standards apply to a broker-dealer audit?

PCAOB standards apply to audits of SEC-registered broker-dealers.

Sources

  • Sarbanes-Oxley Act of 2002, Sections 101 through 103 (PCAOB creation, registration and standards) and Section 404(b)
  • PCAOB, AS 3101, The Auditor’s Report on an Audit of Financial Statements When the Auditor Expresses an Unqualified Opinion
  • PCAOB, AS 2201
  • AICPA, AU-C Section 700, Forming an Opinion and Reporting on Financial Statements
  • Dodd-Frank Wall Street Reform and Consumer Protection Act, Section 982 (PCAOB oversight of broker-dealer audits)

Definitions paraphrase AICPA and FASB guidance; read the standard itself before relying on a requirement. Example figures are illustrative. This page is guidance, not professional advice. Report an error

Standards

PCAOB AS 3101AU-C 700

Related terms

  • Critical audit matters (CAMs)
    Critical audit matters are issues in a public company audit that were communicated to the audit committee, relate to material accounts or disclosures, and involved especially challenging, subjective, or complex auditor judgment.
  • GAAS (generally accepted auditing standards)
    GAAS are the AICPA standards for audits of nonissuers, issued as Statements on Auditing Standards and codified in AU-C sections, covering general responsibilities, evidence, and reporting.
  • SEC (Securities and Exchange Commission)
    The SEC is the federal regulator that requires public companies to file audited financial statements, sets auditor independence rules for issuers, and oversees the PCAOB.
  • AU-C, AR-C and AT-C (SAS, SSARS, SSAE)
    AU-C sections come from Statements on Auditing Standards, AR-C from SSARS, and AT-C from SSAE; each codifies the AICPA standards for audits, review and compilation work, and attestation engagements of nonissuers.

Go deeper

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