Corporate Governance

Ambitious Plans by U.S. Audit Regulator

By Marie L. Oliver

The Public Company Accounting Oversight Board is planning to ?ramp up? the number and scale of its inspections and enforcement actions in 2011.

The new head of the PCAOB, which oversees auditors of U.S.-registered companies, said that the board has been increasing its capacity to inspect audit firms and bring enforcement actions.  He anticipated litigating more and larger cases than in past years.  The board?s actions were hindered from 2006 until last year, when the U.S. Supreme Court resolved a constitutional challenge in its favor.

In addition, the PBAOB announced its plans to pursue overdue inspections of overseas audit firms who work with U.S. public companies.  Among the targeted countries is the United Kingdom, which recently agreed to allow such inspections.  The agreement was made only after the PCAOB was permitted under the newly-passed Dodd-Frank Act to share information with regulators abroad.  The board was previously forbidden under Sarbanes-Oxley from sharing information with foreign regulators, creating obstacles to inspections.  Other countries are still in ongoing negotiations with the board regarding inspections, including China.

Full post as published by PomTalk on March 01, 2011 (boomark / email).