PCAOB Final Registration: Pool of Public Audit Firms Shrinks by 45%

The Public Company Accounting Oversight Board has reviewed and approved registration applications from 598 public accounting firms to provide audit services to public companies. The final list of of approved firms can be found at http://www.pcaobus.org/ApprovedRegistrantsList.pdf.

Last year, approximately 850 CPA firms performed audits of at least one public company, and about 1,100 firms (which includes the 850) retained the training and credentials to perform public company audits had the opportunity arisen. The final number approved by the PCAOB represents a drop of approximately 45% in the total pool of firms eligible to audit listed companies next year.

The Sarbanes-Oxley Act of 2002 and the Board's rules require the registration of all public accounting firms that issue or prepare audit reports on U.S. public companies, or that play a substantial role in the preparation of such audit reports. Beginning today, U.S. public accounting firms must be registered with the Board in order to engage in that work.

"Registration is a prerequisite for accounting firms to continue their work as auditors of public companies," said PCAOB Chairman William J. McDonough. "It is also the foundation, established in the Sarbanes-Oxley Act, for the PCAOB to perform its important functions of inspection and enforcement."

To facilitate inspection, the PCAOB will establish regional offices in the Atlanta, Dallas and San Francisco areas. Inspectors are currently based in the PCAOB offices in Washington, D.C., and New York City.

"Inspection is one of the strongest tools we have to see that accounting firms fulfill the expectations of the Sarbanes-Oxley Act," McDonough said. "Regular inspections will occur every year for firms with more than 100 audit clients. Other firms will be inspected once every three years. And when the Board thinks circumstances warrant, we can order a special inspection, regardless of timing."

You may like these other stories...

Here's a CPA who truly walks the walk. On March 15, Frank Ryan, CPA, departed San Diego, California, with plans to be in Ocean City, Maryland, by July 2 to teach a course at the Maryland Association of CPAs’ (MACPA...
When Theodore J. Flynn first joined the Massachusetts Society of CPAs (MSCPA) in 1970, it was a different world and a different profession.  The "Big Eight" were still headquartered in Boston. Vietnam War...
Accountant Rickey Charles Goodrich had it a little too good. Many bean counters would kill to serve as financial guru to the likes of Pearl Jam. Goodrich was hired in 2005, and the following year, he became the CFO of Curtis...

Upcoming CPE Webinars

Jul 31
In this session Excel expert David Ringstrom helps beginners get up to speed in Microsoft Excel. However, even experienced Excel users will learn some new tricks, particularly when David discusses under-utilized aspects of Excel.
Aug 5
This webcast will focus on accounting and disclosure policies for various types of consolidations and business combinations.
Aug 20
In this session we'll review best practices for how to generate interest in your firm’s services.
Aug 21
Meet budgets and client expectations using project management skills geared toward the unique challenges faced by CPAs. Kristen Rampe will share how knowing the keys to structuring and executing a successful project can make the difference between success and repeated failures.