North America: Accounting and Audit

The CAS Board has published a final rule rescinding several Cost Accounting Standards while retaining specific requirements to protect government interests, marking a significant step in aligning CAS with generally accepted accounting principles. The changes will impact how contractors account for compensated personal absence, material acquisition costs, and tangible asset capitalization and depreciation. Contractors directly affected by the rescission of CAS 408 will benefit from an express exemption from

Artificial intelligence is reshaping audit execution by automating data analysis and improving efficiency, but it cannot replace the professional judgment, accountability, and regulatory defensibility that remain at the core of audit assurance. As organizations increasingly adopt AI tools in their audit workflows, they face new risks around model reliability, transparency, and governance that demand careful management and oversight.

A midyear review can help identify accounting, tax, and payroll issues while there is still time to address them.