SEC’s Nicolaisen Welcomes PCAOB Involvement in Independence Standards-Setting

In response to the Public Company Accounting Oversight Board (PCAOB) action earlier this week, proposing certain ethics and independence rules for public comment, the Commission’s Chief Accountant, Donald T. Nicolaisen, noted that he welcomed PCAOB involvement in this important area.

The PCAOB’s proposed rules grew out of its public roundtable on auditor independence held in July, and address issues relating to tax services and contingent fees.

Although the Commission historically has adopted its own rules and interpretations regarding auditor independence issues – and will continue to provide companies and audit committees with guidance on independence issues – Nicolaisen stated that he looks forward to the PCAOB fulfilling its role and becoming the primary standard-setter and source of guidance to auditors on these issues. “It’s appropriate that the PCAOB play a robust role in the area of auditor independence,” Nicolaisen stated. “Since the passage of the Sarbanes-Oxley Act in 2002, there have been many questions about the types of services auditors may provide without compromising their independence, especially with respect to tax services. PCAOB guidance in this area will be helpful to audit committees, in particular, as they consider these issues.”

There will be an opportunity for public comment on the PCAOB’s proposed rules before the PCAOB Board takes final action, and Nicolaisen stated that he hoped a broad range of commenters would take the opportunity to participate in that process. The final rules adopted by the Board will be submitted to the Commission for approval.

You may like these other stories...

Could the IRS disallow Ice Bucket Challenge charitable contributions?Unless you’ve been living under a rock, you’ve probably heard of – or participated in – the ALS Ice Bucket Challenge.I was...
As a general rule, a taxpayer can deduct the full amount of monetary contributions made to a qualified charitable organization, as long as certain substantiation requirements are met. These donations are typically made...
Hertz withdraws full-year forecast, cites accounting review, challengesRental car company Hertz Global Holdings Inc. said on Tuesday it is withdrawing its full-year financial forecast and expects 2014 results to be “...

Already a member? log in here.

Upcoming CPE Webinars

Aug 26
This webcast will include discussions of recently issued, commonly-applicable Accounting Standards Updates for non-public, non-governmental entities.
Aug 28
Excel spreadsheets are often akin to the American Wild West, where users can input anything they want into any worksheet cell. Excel's Data Validation feature allows you to restrict user inputs to selected choices, but there are many nuances to the feature that often trip users up.
Sep 9
In this session we'll discuss the types of technologies and their uses in a small accounting firm office.
Sep 11
This webcast will include discussions of commonly-applicable Clarified Auditing Standards for audits of non-public, non-governmental entities.