The US audit watchdog has survived a court challenge which threatened to overturn the regulator landmark US legislation born out of the Enron scandal.
Under the ruling, handed down by the US Supreme Court yesterday, the audit industry regulator, the Public Company Accounting Oversight Board (PCAOB), will continue to operate, however its board members will be removable by the US securities regulator “at will” rather than for “good cause”.
Critically, the 5-4 ruling keeps the board’s primary functions in tact and allows it to continue operating. It was feared the board’s demise have opened the door to new legislation which could include far ranging reform for auditors and the financial services industry.
In a statement, PCAOB Acting Chairman Daniel Goelzer welcomed the decision.
"We are pleased that the decision allows the PCAOB to continue without interruption to carry out its important mission of overseeing public company audits in order to protect investors and promote the public interest," he said.
You may also like
AccountancyAgeInsight is a frequently updated resource centre for finance professionals, offering a free and easy-to-use digital library of briefings, white papers and other information resources.