In May, the Auditing Standards Board (ASB) of the American Institute of Certified Public Accountants (AICPA) issued Statement on Auditing Standards No. 134, Auditor Reporting and Amendments, Including Amendments Addressing Disclosures in the Audit of Financial Statements (SAS 134).

The issuance of SAS 134 concludes the efforts of the AICPA, International Auditing and Assurance Standards Board (IAASB), and the Public Company Accounting Oversight Board (PCAOB) to improve the auditor reporting standards. The IAASB issued their revisions to auditor reporting in 2015 and the PCAOB followed in June 2017.

The two most significant changes to the current standards are the ordering of the audit report sections, and the introduction of key audit matters (KAM).The table below summarizes the differences in the presentation of the report sections under the current standards and SAS 134:

SAS 134 allows for KAMs to be added to the audit report only when the client has engaged the auditor to include such matters. The new standard has defined KAMs as "those matters that, in the auditor's professional judgement, were of most significance in the audit of the financial statements of the current period. Key audit matters are selected from matters communicated with those charged with governance."

The effective date for the provisions of SAS 134 are for audits of financial statements for periods ending on or after Dec. 15, 2020. Early adoption is not permitted.