Letter to PCAOB on Strategic Priorities

To Whom It May Concern:

The American Bankers Association (ABA) welcomes the opportunity to comment on the Public Company Accounting Oversight Board's (PCAOB) Request for Public Comment – PCAOB Strategic Priorities (the RFI). The RFI seeks input regarding strategic priorities as the Board develops its 2026–2030 strategic plan and refreshes its standard-setting focus areas.

Executive Summary

Banking context and risk assessment: Because banks operate under extensive prudential supervision, examinations, and regulatory reporting, the PCAOB should recognize how that framework affects audit risk assessment and avoid expectations that duplicate existing regulatory requirements. The PCAOB should also examine whether its inspections program is assigning disproportionate risk to the banking industry, as reflected in the comparatively higher selection rate of bank audits for inspection review, and recalibrate its selection approach to ensure that it is evidence-based and balanced. That concern is compounded by the comparatively limited number of inspections personnel with meaningful banking experience. ABA believes this dynamic can create a circular pattern in which inspections generate more findings, which in turn reinforces a perception of heightened risk in the banking industry. The result is significant inefficiency and unnecessary cost.

Audit efficiency and proportionality for community banks: The PCAOB should make audit efficiency and cost a clear priority by reinforcing scalable, risk-based auditing and discouraging checklist-driven expansions in testing and documentation. This is especially important for community banks, where audit cost and auditor availability are practical components of audit quality and where smaller and mid-sized audit firms play a critical role in preserving a competitive audit market.

Inspections, reporting, standard setting and transparency: As QC 1000 is implemented, inspections should place greater weight on evaluating firm-wide quality controls and, where appropriate, perform fewer engagement-level reviews of individual audits, while promoting clarity and reducing redundant expectations in highly regulated environments.

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