The Securities and Exchange Commission has rubber-stamped a new auditing standard, but with encouragement to the Public Company Accounting Oversight Board to consider developing a new rule advising auditors of their responsibility regarding confidential client information.

The SEC did its own due diligence on Auditing Standard No. 6 Evaluating Consistency of Financial Statements and Amendments to Interim Auditing Standards, including publishing the rule for comment. The PCAOB approved the standard in late January, primarily to align auditing standards with accounting standards on how to evaluate inconsistency in financial statements and to remove the hierarchy of Generally Accepted Accounting Principles from auditing literature.

The SEC received three comments on the standard, all from accounting firms and all supportive, the SEC said in its final order approving AS6. However, the SEC noted one of the firms worried that the new standard’s interplay with professional rules written by the American Institute of Certified Public Accountants could be construed as minimizing the auditor’s responsibility for maintaining confidentiality around client information. The SEC agreed and advised the PCAOB to take a look at the matter.

The PCAOB had no immediate comment on whether it would consider developing such a rule.

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