TheCorporateCounsel.net

Dan Goelzer highlights in his most recent Audit Committee and Auditor Oversight Update a BDO memo titled Economic Uncertainty: Financial Reporting Considerations for Tariffs, which discusses key accounting, financial reporting and disclosure issues for public companies in light of the new tariffs. The memo also highlights the following six questions that the audit committee should be asking management and the auditors:

– Do the financial statement disclosures reflect changing risk factors, such as changes in supply chains, pricing decisions, loss of significant customers, and disruptions to production?

– Do the financial statement disclosures reflect subsequent events that were known or knowable before issuing the financial statements that users of financial statements will find meaningful and reflective of industry-specific considerations?

– Are controls over financial reporting adequate to respond to the effects of tariffs or the resulting economic uncertainty, including the risk of fraud?

– Will financial statement deadlines be affected by changes to procedures performed by the entity, its specialists, or the auditors?

– Is the committee meeting often enough with management and the auditors to address challenges as they arise?

– Is the committee keeping the board apprised of significant matters with respect to risk and disclosure?

Be sure to check out all of our tariff-related resources in our new “Trump Administration Tariffs” Practice Area. If you are not a member, you can try a no-risk trial now. Sign up online or contact our sales team at Sales@CCRcorp.com or by phone at 800-737-1271. Our “100-Day Promise” guarantees that during the first 100 days as an activated member, you may cancel for any reason and receive a full refund.

– Dave Lynn