Largely reflecting the dramatic increases in voluntary disclosure since 2012 about the audit committee's practices and accountability, EY's latest report: "What audit committees are reporting to shareholders” reveals these (among other) key takeaways based on the firm's tracking and analysis of Fortune 100 proxy statements filed since 2012:
- 75% of companies disclosed audit committee oversight of cybersecurity in their 2023 proxy statements, up from 70% in 2021. Nearly 30% of proxies disclosed audit committee oversight of other nonfinancial risks or disclosure controls and procedures on topics like ESG, environment, sustainability, and climate.
- The percentages of designated financial experts and female committee members on audit committees have increased fairly significantly over time, as noted here:
71% of companies disclosed the factors considered by the audit committee when assessing the external auditor's qualifications and work quality - up from 68% in 2021 and 15% in 2012.
- More than one-quarter of companies disclosed the audit committee’s discussion of CAMs with the external auditors, compared to 20% in 2021.
The line graphs on page 3 of the report detail results by year. In addition, the report includes sample instructive disclosures on several key topics, including factors used in the audit committee's assessment of the external auditor and work quality and the audit committee's involvement in selecting the lead audit partner. The memo also poses several questions for audit committees to consider regarding audit committee-related disclosures.