Report of the President

What a privilege for me to serve as your Section's president for 2005-2006. I find it hard to believe that this is my last President's Report before I turn over the gavel in August to Ray Whittington, our incoming president. I continue to be amazed at all the exciting work ongoing in our Section and among our members. Thank you for your hard work and for allowing me to serve.

Tribute to John Willingham
One of the joys of active membership in the Auditing Section is the opportunity to be surrounded by major thought-leaders and visionaries of our profession. In mid-April, our Section lost one of its influential leaders, John Willingham, who passed away at the age of 71. We all owe a great debt of gratitude for John's leadership and vision related to the importance of auditing research. His role in launching KPMG's Research Opportunities in Auditing Program played an unbelievably significant role in propelling auditing research to new heights, which we all enjoy today.

To honor John's memory and to recognize in some way his major contributions, this issue includes a compilation of tributes to John authored by numerous leaders of our section. Through these tributes, we hope John's family and friends will see a glimpse of the respect and appreciation held by so many in our profession for John's significant contribution to the field of auditing.

Call for Officer Nominations
Our Section is fortunate to have many dedicated and talented individuals with unique ideas, such as John Willingham's vision for the ROA program, that have made and continue to make such a difference in each of our professional lives today. It is vitally important that the Section continue is track record of attracting outstanding Section leaders to serve in its key leadership positions.

This fall, our Section will elect two new officers – Vice President-Academic (President-Elect) and Treasurer, who will begin service in August 2007. Please take a moment to nominate individuals who you believe would provide effective service in these key officer positions. Nominations should be submitted by July 1, 2006. More details are provided about these calls on our Section's web site.

Democratic Process – Be Sure to Vote!
The Auditing Section is one of the few within the AAA that hold democratic officer elections with two candidates per office. Each fall, the Section nominates several active members who willingly allow their names to be put forward for leadership service.

The Executive Committee is examining the voting processes of other sections and has discussed whether it is in the Section's best interest to continue nominating two candidates per office. While we very much value the importance of the democratic process of allowing our members to choose among several excellent candidates, the Executive Committee is concerned that an unintended message is signaled to those individuals who are ultimately not elected. Because everyone of our nominees is extremely capable of providing outstanding service, the last thing we want to do is alienate any individual from the Section when he or she is not selected.

While our Section's process of voting online (relative to the former paper voting at our Business Meetings) has improved the numbers of members who participate in the voting process, we still have less than 18% of our membership casting votes in each election. One way you can signal your support of continuing the democratic process is by voting. Be sure you and your Auditing Section colleagues engage in the democratic process by casting a ballot. Watch for announcements in early fall about our election process and be sure to take the time to place your vote.

Call for Award Nominations
Our Section is loaded with incredibly talented individuals who regularly contribute to auditing education, research, and service to the profession. Each year, we pause to recognize and honor Section members for their significant achievements through our Section's Awards.

It's that time of year where we need you to nominate individuals for one of these five Section Awards:

• Notable Contributions to the Auditing Literature
• Distinguished Service
• Outstanding Auditing Educator
• Outstanding Auditing Dissertation
• Innovation in Audit and Assurance Education

The nomination deadline is July 1, 2006. Please review call details for each award, which are posted on our section's web site.

PCAOB Research Syntheses Teams
In February, the PCAOB hosted in Washington members of these research teams, in addition to others representing our Section, the AAA, the SEC, the GAO, and others, for its second PCAOB AAA Conference. Each team had the opportunity to hear from key members of the PCAOB Board and Staff about key activities in auditing standards-setting and other activities in the PCAOB including inspections, enforcement, and analysis. The teams also met in working sessions to develop detailed work plans for the research syntheses to ensure timely delivery of key insights for the benefit of the PCAOB. We are grateful to Gary Holstrum, Associate Chief Auditor and Director of Research at the PCAOB, for his leadership and support of these important projects. Watch for the June 2006 issue of Accounting Horizons to see the first of these research syntheses projects (this one is focused on risk assessment), which has been completed and forwarded to the PCAOB.

Practice Advisory Council's Sponsored Research
This winter you received several announcements of the Request for Proposals (RFPs) for research to be sponsored by our Section's Practice Advisory Council (the PAC). The RFP submission deadline was April 7, 2006 and the PAC was pleased to receive several outstanding research proposals. As I write this report, the PAC is in the process of reviewing submitted proposals with the goal of announcing selected projects by June 1, 2006.

This is another great opportunity for our Section to conduct research relevant to members of the practice community by addressing significant practice issues. The Section is extremely fortunate to have the engagement of significant practice leaders who serve the Section through involvement on the PAC. These individuals have committed access to subjects and data for the selected projects. What a great example of how partnerships between the academic and practice communities can be a huge benefit to all involved. Watch for announcements of selected projects in June.

ASB and IAASB Focus on the Auditor's Report
Both the AICPA Auditing Standards Board (ASB) and IFAC's International Audit and Assurance Standards Board (IAASB) have standards setting projects underway related to potential revisions to the standard auditor's report. We are in current discussions with representatives of both the ASB and IAASB about how research about the auditor's report might be helpful to these standards-setters as they consider potential changes to these reports. If you have research interests related to the auditor's report, be on the alert for future announcements about research opportunities related to these initiatives.

New Online Journal
Over the last year, you have been reading about the Section's consideration of the launch of a new online journal related to current issues in auditing and the accounting profession. In January 2006, the Section's Executive Committee voted to pursue AAA level approval of this new online journal. Since then, we have presented this proposal to the AAA's Publications Committee, the AAA Executive Committee, and the AAA Council. I am pleased to report that in April the AAA Executive Committee approved the Section's request to launch this new journal!

The goal of this journal is to provide a mechanism to establish an ongoing dialogue between members of the academic and practitioner communities. The focus on current practice-related issues is a natural intersection for meaningful participation and dialogue with practitioners and academics because both groups share a common interest in improving the state of the art of the accounting and auditing profession.

The primary focus of this journal is on providing timely articles featuring current issues affecting the accounting and auditing profession. Most of the content will provide commentary-style pieces prepared by academics, practitioners, or combinations of both that provide thought-pieces related to issues affecting standards, practice implementation, training, or other relevant practice issues. Because the focus is primarily on recent, current issues, such pieces should attract the interest of both practitioners and accounting educators who are interested in up-to-date insights about current issues facing the profession.

The purpose of this journal is not to compete with any existing journal of the AAA, specifically Auditing: A Journal of Practice and Theory, Issues in Accounting Education, or Accounting Horizons. Rather, the mission is complimentary versus competing. The nature of articles likely to be included in this journal would more closely resemble the types of audit-focused pieces one might find in journals such as the Journal of Accountancy or other similar practice outlets. Articles will be much shorter and unlikely to contain statistical analyses.

The Section's leadership is currently working with the AAA staff to iron our practical details about the online portal platform that will host the online journal. We are also finalizing details related to the journal's editorial policies and board. Watch for formal announcement details in summer 2006.

AAA Annual Meeting – August 6-9, 2006
I hope you are making plans to join us at the AAA's 2006 Annual Meeting to be held in Washington, DC August 6th – 9th. Julia Higgs, the Auditing Section's Annual Meeting Coordinator, is heading up our Section's programs at the AAA meeting, with the assistance of Chris Earley. Over 130 research and education related papers were submitted for the Section's sponsored concurrent sessions. We are indebted to many of you who served as reviewers of these papers.

The Auditing Section will host 23 concurrent sessions where many of these papers will be presented. Additionally, Julia and Chris are working very hard to pull together five outstanding panel sessions that will focus on current issues affecting the auditing profession, including panels on the PCAOB's inspections, enforcement, and research and analysis activities, issues related to small public company compliance with Sarbanes-Oxley and Section 404 reporting. We are also excited about a panel session that will focus on providing insights related to teaching corporate governance courses in MBA programs.

Our annual Section luncheon will be held on Monday, August 6th. Our luncheon speaker will be Jeanette Franzel, Director - Financial Management and Assurance and Project Director for Government Auditing Standards at the Governmental Accountability Office (GAO). Jeanette is heavily involved in GAO standards-setting issues and is also involved in international standards-setting initiatives with numerous other countries around the world. I am thrilled that our Washington meeting location allows us to hear from an individual so involved in national governmental leadership. Make plans to be there!

2007 Auditing Section's Mid-Year Conference
Karla Johnstone and Terry Neal are working hard on our 2007 Mid-Year Auditing Section Conference to be held January 11-13, 2007 in Charleston, South Carolina. It's time now for you to be finalizing projects you wish to submit for program consideration. The call for paper submissions and session proposals is September 1, 2006. Check out the call for submissions to the 2007 Mid-Year Conference on our Section's web site.

The Section will also host its annual Auditing Doctoral Consortium on Thursday, January 11, 2007, prior to the start of the Mid-Year Conference. Jane Kennedy is serving as the Doctoral Consortium Chair. If you work with current PhD students, make sure they are aware of this great opportunity to network with auditing scholars and fellow PhD students.

The hotel meeting location is in walking distance of Charleston's historic and shopping districts. It will be a great location that you'll not want to miss!

Kudos to Outgoing Officers!!
Let me conclude with my thanks to all of you who serve in committee and officer positions on behalf of the Section. Our Section's success is due to the efforts of many.

In August, Linda McDaniel (Past-President), Scott Showalter (Vice President-Practice), and Kay Tatum (Secretary) will rotate off the Executive Committee. Each of these individuals has committed numerous hours and countless energy as they have so unselfishly served our Section in innumerable ways. What a privilege it has been for me to work closely with each of them. While we will miss them immensely on the Executive Committee, we are excited to welcome three new individuals to the Executive Committee – Mark Peecher (Vice President – Academic), Trevor Stewart (Vice President – Practice) and Julia Higgs (Secretary). I look forward to my continued involvement with the Executive Committee.

Have a great summer. I look forward to seeing you in Washington in August!