AICPA tells auditors to assess AI in clients' reporting and in their own audit tools
The AICPA issued a two-part practice aid on Tuesday on AI in clients' financial reporting and in auditors' own tools. Section two makes engagement partners responsible for confirming that AI tools are firm-approved and used correctly by staff.
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Engagement partners are responsible for understanding their AI tools and ensuring firm approval and correct use by staff. Section two calls for firm quality management policies on AI and recommends planning AI use in specific engagements. Audit teams may need AI, data and specialist skills.
- constraint Engagement partners Responsible for understanding their AI tools and ensuring firm approval and correct use by staff, claim 12
- constraint Audit firms Section two calls for quality management policies and procedures on the firm's AI responsibilities, claim 10
- decision Firms planning engagements Aid recommends planning the intended use of AI in specific engagements, claim 11
- capability Audit teams May need a blend of auditing expertise, AI knowledge, data skills and specialist support, claim 8
| Who | How | Kind | Claim |
|---|---|---|---|
| Engagement partners | Responsible for understanding their AI tools and ensuring firm approval and correct use by staff | constraint | 12 |
| Audit firms | Section two calls for quality management policies and procedures on the firm's AI responsibilities | constraint | 10 |
| Firms planning engagements | Aid recommends planning the intended use of AI in specific engagements | decision | 11 |
| Audit teams | May need a blend of auditing expertise, AI knowledge, data skills and specialist support | capability | 8 |
What happened
- The AICPA says more guidance is coming for section one, including a deeper dive into risk of material misstatement and evaluation of audit evidence when a company uses AI.
- Section one covers how AI differs from ordinary automation and how that difference may affect the auditor's risk assessment.
- The new risks it names are data risks, model risks, hallucinations, explainability and bias.
- Section two emphasizes quality management policies and procedures to address a firm's responsibilities relating to AI tools.
Why it matters
- constraint Until the section-one additions arrive, a team auditing a client that uses AI has topics to consider but not yet the AICPA's treatment of misstatement risk and audit evidence.
- cost The aid says teams may need specialist support alongside audit expertise and AI and data skills. That support adds hours to an engagement, and the firm or the client has to pay for them.
- decision Firms using AI on audits must settle which tools they approve and write down intended use engagement by engagement, since a partner can only confirm what the firm has decided.
- precedent AI guidance is arriving in pieces across the audit, SOC engagements and ethics, so a firm's AI policy will need amending as each piece lands.
The aid lists topics without setting out procedures. That limits how far it works as a baseline. Titled Artificial Intelligence (AI) Considerations for Financial Statement Auditors, it is designed to help auditors understand and respond to AI in business processes and financial reporting [3]. The CPA Practice Advisor's account does not call it a requirement. We think that makes it a shared vocabulary and a list of questions. The counter-reading is that topics set out across two sections are enough of a checklist that firms will work through them line by line.
The working content is about data. Six attributes of the data behind an AI system (quantity, quality, accuracy, completeness, relevancy and diversity) can significantly affect its reliability, according to the practice aid as the report summarizes it [c7, d2]. For an auditor testing a control that runs through a model, we'd expect that to move the first question upstream: before asking whether the output was right, ask whether the inputs were complete, accurate and diverse enough to trust. That is our inference from the list.
Section two is where responsibility is plain. "Ultimately, the auditor remains responsible for the audit and the audit opinion," AICPA Chief Auditor Jennifer Burns said in a statement [15]. Amy Pawlicki, the AICPA's vice president of assurance and advisory innovation, said in a statement, "AI tools are already benefiting the efficiency and effectiveness of both financial statement preparation and the audit in a number of ways," [13] and added, "But as powerful as they are, these tools can introduce new risks that auditors must be cognizant of in fulfilling the critical role they play in performing financial statement audits." [14]
The two quotes sit in the same document, and the efficiency a firm books from an AI tool is not separable from the supervision the aid then asks for.
What would change our view is the section-one material still to come [5]. If it names procedures for evaluating audit evidence from a client's AI system, the aid becomes a baseline for audit procedures and we'd say so. If it adds only more topics, it remains a list of topics with no procedures attached.
What to watch
- Whether the promised section-one additions on risk of material misstatement and audit evidence name specific procedures or add more topics.
- The extra questions and answers expected in the section on auditors' own use of AI, which will show how firms are applying the partner-approval duty.
- Whether later versions say how the aid relates to the application of professional standards, a question section one already raises.
Clarity's read
What the record supports and how the coverage leans. The claims behind it follow.
Reality
- Evidence60
- Adoption
- Insufficient
- Hype gap−10
- Incentives
- Insufficient
- Confidence65
Claim ledger
Ranked by verification strength, evidence, and original report placement.
- [1]
The American Institute of CPAs issued a new practice aid on Tuesday that aims to help auditors better understand how artificial intelligence affects the financial statement audit.
- [2]
The guidance centers on two areas: when an organization uses AI in its financial reporting or controls, and when auditors use AI-related technology in performing the audit.
- [3]
The practice aid, Artificial Intelligence (AI) Considerations for Financial Statement Auditors, is designed to help auditors understand and respond to the use of AI in business processes and financial reporting.
- [4]
The practice aid is divided into two parts: the first covers how an organization's use of AI in financial reporting affects the financial statement audit, and the second covers audit firms' use of AI-related technological resources in their audit engagements.
- [5]
More guidance, including a deeper dive into assessment of the risk of material misstatement and evaluation of audit evidence when a company is using AI, will be added to section one in the future; more questions and answers are expected in the section on the implications of using AI in the audit process.
- [6]
Section one of the practice aid discusses AI in broad terms, its different variations, how AI differs from ordinary automation, and how that may affect the auditor's risk assessment.
- [7]
Section one discusses how the quantity, quality, accuracy, completeness, relevancy, and diversity of data can significantly affect the reliability of an AI system.
- [8]
Section one discusses the need to assess the audit team's capabilities, because practitioners may need a blend of auditing expertise, AI knowledge, data skills, professional skepticism, and specialist support.
- [9]
Section one discusses types of new risks that can be introduced by AI, such as data risks, model risks, hallucinations, explainability, and bias.
- [10]
Section two emphasizes the importance of establishing quality management policies and procedures to address the firm's responsibilities relating to AI tools.
- [11]
Section two addresses firm-level considerations about the competence and capabilities of the engagement team when using AI tools, and recommends audit firm planning on the intended use of AI in specific engagements.
- [12]
Section two outlines the responsibilities of engagement team partners to understand the AI tools they are using, ensure they are approved by the firm and are being used correctly by staff.
- [13]
AI tools are already benefiting the efficiency and effectiveness of both financial statement preparation and the audit in a number of ways
- [14]
But as powerful as they are, these tools can introduce new risks that auditors must be cognizant of in fulfilling the critical role they play in performing financial statement audits.
- [15]
Ultimately, the auditor remains responsible for the audit and the audit opinion.
- [16]
In the past year the AICPA has issued two other relevant items on AI topics: guidance on the effect service organizations' use of AI could have on SOC 1 and SOC 2 engagements, and a staff insights article, AI Through an Ethics Lens.
- [17]
Counting the new practice aid and the two earlier items, the AICPA has issued three AI-related items in about a year.
- [18]
The data attributes the aid lists as affecting AI reliability number six: quantity, quality, accuracy, completeness, relevancy and diversity.
Sources
1 independent publisher whose own reporting we read for this story.
- cpapracticeadvisor.comAICPA Practice Aid Provides Guidance to Auditors on AI Use in Financial Statement Audits
2 articles · October 13, 2026
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