Congress has failed to authorize funds for the new Public Corporate Accounting Oversight Board (PCAOB) created by the Sarbanes-Oxley Act of 2002. The Securities and Exchange Commission has been given the task of staffing the board no later than October 28, 2002, but as yet there is no budget for the new organization.
The SEC expects to meet its October 28 deadline for appointing the five-person staff to the PCAOB, but there are no funds for the board. "The public thinks we have all this money, but we haven't seen one red cent," said SEC Chairman Harvey Pitt last week.
Congress passed a budget resolution last week that keeps the government going through November 22, but no funds were allocated to the SEC. "We're not hiring any staff. We're basically at a frozen level," said SEC spokesman Brian Gross. "There's no enhancements going on for all of the functions that Sarbanes-Oxley requires."
In addition to funding for the PCAOB, the SEC is awaiting money to hire new staff and upgrade outdated computer systems. The SEC also hopes to get additional funding to improve its ability to provide more frequent reviews of companies and to speed investigations.