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Board discusses NASBA/AICPA APS exposure draft and BARC flags risks with freelance audits
Summary
Board members were briefed on NASBA's request for feedback on the Alternate Practice Structure exposure draft; BARC highlighted concerns about oversight, ownership issues, and the emergence of low-quality "freelance" audits and security-audit workarounds.
Deputy Director Jennifer Sciba briefed the Board on takeaways from the 2026 NASBA Executive Directors and Legal Counsel Conference, noting NASBA's request that state boards provide feedback on the AICPA PEEC exposure draft regarding Alternate Practice Structures (APS). NASBA asked boards to comment on the complexity and enforcement ambiguity of APS models and to continue dialogue across states.
Brooke Stegmeier, reporting for the Board/AICPA Rules Committee (BARC), said the committee is tracking APS developments and other states' approaches to regulating professional-entity ownership. BARC also flagged concerns about "cheap / freelance audits" that may bypass verification and noted digital seals and authentication as potential responses. The committee intends to collect more information at the NASBA Western Regional Meeting in June.
The Board did not adopt rule changes at this meeting but approved continued monitoring and engagement with NASBA and AICPA on APS and peer-review issues.
