Camden CAO Urges Cautious Approach on Identification of Critical Audit Matters

Michael Gallagher, senior vice president and CAO at Camden Property Trust (NYSE: CPT), participated in a video interview at Nareit's REITwise: 2018 Law, Accounting & Finance Conference in Hollywood, Florida.

Last year, the Securities and Exchange Commission (SEC) approved the Public Company Accounting Oversight Board’s (PCAOB) proposed changes to The Auditor’s Report.

Gallagher noted that the second part of the new audit guidance—which involves audit firms having to identify critical audit matters and disclose them publicly—won’t take effect until June 30, 2019.

The biggest concern about the changes is that they are still evolving, Gallagher said: “While the rule is still out there, no one’s really certain as to what’s going to happen.”

Gallagher stressed that companies need to take a “hard look” at the changes to the auditor report.

“What’s determined to be critical is going to be disclosed to the world and it may indicate a problem where there’s not a problem,” Gallagher said.