SEC seeks to probe non-US audit papers

According to Richard Walker, director of the Division of Enforcement at the SEC, if the commission is to effectively carry out its mission of investor protection ‘it is critical that the commission staff have ready access to audit work papers regardless of where they are located’.

Despite the contention of audit firms that foreign affiliates are separate legal bodies and do not have access to such documentation, Walker believes that foreign company’s issuing shares on US capital markets, should be required to provide the same access to information, as domestic issuers are required to provide.

Commenting on the success of the enforcement division, Walker said it had uncovered close to 100 financial reporting cases in the fiscal year ended 30 September, up 10% on last year.

He added that the division’s top priority would continue to be combating financial problems with sanctions remaining tough. Walker said the SEC would continue its zero-tolerance approach to securities law violations.

The Division of Enforcement is tasked with investigating possible violations of US federal securities laws, and prosecutes the SEC’s civil suits in the federal courts as well as its administrative proceedings.


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