What rule(s) come into play with our auditors and my company's earnings press release?

Question

Do the even need to look at it?

If so why?

Answer 1

Yes, if the press release contains audited financial statements. Guidance on this is given by ISA 720, which I reproduce here in part:

1. The purpose of this International Standard on Auditing (ISA) is to establish standards and provide guidance on the auditor’s consideration of other information, on which the auditor has no obligation to report, in documents containing audited financial statements. This ISA applies when an annual report is involved; however, it may also apply to other documents, such as those used in securities offerings.
2. The auditor should read the other information to identify material inconsistencies with the audited financial statements.
3. A “material inconsistency” exists when other information contradicts information contained in the audited financial statements. A material inconsistency may raise doubt about the audit conclusions drawn from audit evidence previously obtained and, possibly, about the basis for the auditor’s opinion on the financial statements.
4. An entity ordinarily issues on an annual basis a document which includes its audited financial statements together with the auditor’s report thereon. This document is frequently referred to as the “annual report.” In issuing such a document, an entity may also include, either by law or custom, other financial and non-financial information. For the purpose of this ISA, such other financial and non-financial information is called “other information.”
5. Examples of other information include a report by management or those charged with governance on operations, financial summaries or highlights, employment data, planned capital expenditures, financial ratios, names of officers and directors and selected quarterly data.
6. In certain circumstances, the auditor has a statutory or contractual obligation to report specifically on other information. In other circumstances, the auditor has
no such obligation. However, the auditor needs to give consideration to such other information when issuing a report on the financial statements, as the credibility of the audited financial statements may be undermined by inconsistencies which may exist between the audited financial statements and other information.
7. Some jurisdictions require the auditor to apply specific procedures to certain of the other information, for example, required supplementary data and interim financial information. If such other information is omitted or contains
deficiencies, the auditor may be required to refer to the matter in the auditor’s report.
8. When there is an obligation to report specifically on other information, the auditor’s responsibilities are determined by the nature of the engagement and by local legislation and professional standards. When such responsibilities involve the review of other information, the auditor will need to follow the guidance on review engagements in the appropriate ISAs.

The whole ISA is available at the link.