Quarterly Perspectives: Financial Reporting & Beyond / Q4 2025
January 8, 2026Recently, professionals from Forvis Mazars closed out 2025 during the Q4 2025 Quarterly Perspectives; Financial Reporting & Beyond webcast with a discussion on critical developments in financial reporting and auditing, emphasizing regulatory uncertainty, communication challenges, political influences on standard setting, insights from the AICPA Conference, and fraud prevention. These themes reflect the evolving landscape for organizations and their auditors as they navigate complex reporting environments. Such considerations are evergreen and can be focused on throughout the next fiscal year and beyond.
Regulatory Uncertainty & Government Shutdown Impact
The extended government shutdown in October and November put pressure on the regulatory environment, including the SEC. Daily operations were curtailed, and the SEC emerged with a very significant backlog of registration statements and filings requiring disposition at the end of the shutdown. In addition, the shutdown suspended work on the Commission’s regulatory agenda as established by Chairman Paul Atkins. It can be expected that the SEC will accelerate its work, especially on the regulatory front, given the objectives Chair Atkins has established and a relatively short time to achieve them, as the potential for changing administrations and accompanying regulatory focus is now a fact of life in Washington, D.C. Participants in the financial reporting ecosystem are encouraged to remain informed on regulations and other legislative guidance rolled out.
Communication Breakdowns Leading to Accounting Errors
With the onslaught of artificial intelligence (AI) and other digital tools, the need for robust communication systems within organizations is more essential than ever. Mergers, acquisitions, and structural changes often create gaps where critical information—such as entering into a lease or other contract modification—fails to reach accounting teams. These oversights can result in misstatements or delayed disclosures. Companies should be adapting by broadening their outreach to multiple internal stakeholders, as knowledge of transactions is increasingly dispersed across business units. A reliance on technology should not come at the expense of communication within a business: maintain communication, information sharing, and transparency when going through structural changes to help offset potential communication breakdowns.
Intersection of Standard Setting & Politics
Political dynamics continue to shape accounting and auditing standards. There are legendary historical examples, such as debates over stock option expensing in the mid-1990s and again in the early 2000s. Recently, appropriations debates included proposals to restrict the SEC’s ability to approve the FASB’s budget over the adoption of a new tax disclosure standard. While that measure did not pass, the attempt alone underscores how politics can still target the standard-setting process which should focus on high quality standards and illustrate how legislative pressures can influence or disrupt technical decisions. Current conversations include international convergence and funding concerns for global standard setters, particularly regarding environmental reporting priorities. The SEC has signaled a desire for greater U.S. representation in international forums to maintain influence over emerging standards.
Insights from the AICPA Conference
The annual AICPA Conference on Current SEC and PCAOB Developments for 2025 provided a forward-looking view of regulatory priorities. Key themes included capital formation, disclosure reform, and PCAOB oversight. The SEC emphasized reducing “disclosure overload” and moving away from “regulation by enforcement” toward clearer rulemaking. Emerging risks such as AI and digital assets were prominent topics, with regulators cautioning that AI in financial reporting requires strong governance, reproducibility, and human oversight to mitigate risks like data manipulation. Senior SEC leadership, including Chair Atkins and Chief Accountant Kurt Hohl, noted the PCAOB’s future structure and inspection approach remain under review, with discussions about shifting inspection focus toward quality control systems rather than issuer-specific audits. (Note that a new board was named following our webcast.)
Fraud & Whistleblower Programs
Lastly, fraud remains a persistent concern, driven by incentives, opportunities, and rationalization—the classic fraud triangle. Financial fraud is not just a theoretical risk. Of the webcast respondents, 13.5% (or nearly one in seven) shared that they have personally experienced financial fraud during their careers.
The Association of Certified Fraud Examiners March 2024 publication, “Occupational Fraud 2024: Report to the Nations,” reaffirmed that whistleblower tips are the most effective detection method, identifying 43% of reported cases compared to only 3% identified by external audits.1 Organizations are encouraged to offer multiple reporting channels and foster a culture of transparency. Upcoming changes to auditing standards may require auditors to gauge whistleblower processes more closely, making early adoption of robust programs essential.
How Forvis Mazars Can Help
At Forvis Mazars, we assist organizations in navigating regulatory changes, strengthening internal communication, and addressing emerging risks such as AI integration. Our experienced professionals provide insights into governance frameworks, fraud prevention strategies, and evolving disclosure requirements. By aligning with your objectives, we aim to support informed decision-making and build confidence in your financial reporting processes.
For more information, please reach out to a professional at Forvis Mazars.
In addition, be sure to register for our Quarterly Perspectives 2026 webcasts throughout the year.
In addition, please join us in recognizing Liz Gantnier, who is retiring soon from the firm. We are deeply grateful for her years of service, and her dedicated involvement with the Quarterly Perspectives webcast since its first production in April 2021. Thank you for your many, many contributions, Liz!
- 1 “Occupational Fraud 2024: A Report to the Nations,” legacy.acfe.org, 2024.