PRIA, Government Policy, Made Personal

Summary

A public accounting firm must be registered with the Public Company Accounting Oversight Board before it prepares or helps prepare any audit report for an issuer, broker, or dealer. To register, the firm must use the Board’s form and give the detailed information the Board asks for. That includes names of clients from last year and those it expects now, fees received for audits and other services, recent financial data, its quality-control policies, a list of accountants and their license numbers, any pending legal or disciplinary actions, copies of any client disclosures about accounting disagreements, and other items the Board or the SEC requires. The firm must also agree to cooperate with the Board’s requests for testimony and documents and must get the same agreement from its associated accountants; cooperation is required to keep the registration. The Board must approve a complete application within 45 days unless it sends a written disapproval or asks for more information. A disapproval counts as a disciplinary action under related rules. Registered firms must file an annual report and update their information as needed. Applications and reports are generally open for public inspection, but the Board must protect confidential or proprietary information the firm identifies. The Board will charge a registration fee and an annual fee to cover its costs.

Title 15, §7212

Commerce and Trade, Source: USLM XML via OLRC

(a)Mandatory registration

It shall be unlawful for any person that is not a registered public accounting firm to prepare or issue, or to participate in the preparation or issuance of, any audit report with respect to any issuer, broker, or dealer.

(b)Applications for registration

(1)Form of application

A public accounting firm shall use such form as the Board may prescribe, by rule, to apply for registration under this section.

(2)Contents of applications

Each public accounting firm shall submit, as part of its application for registration, in such detail as the Board shall specify—

(A)the names of all issuers, brokers, and dealers for which the firm prepared or issued audit reports during the immediately preceding calendar year, and for which the firm expects to prepare or issue audit reports during the current calendar year;

(B)the annual fees received by the firm from each such issuer, broker, or dealer for audit services, other accounting services, and non-audit services, respectively;

(C)such other current financial information for the most recently completed fiscal year of the firm as the Board may reasonably request;

(D)a statement of the quality control policies of the firm for its accounting and auditing practices;

(E)a list of all accountants associated with the firm who participate in or contribute to the preparation of audit reports, stating the license or certification number of each such person, as well as the State license numbers of the firm itself;

(F)information relating to criminal, civil, or administrative actions or disciplinary proceedings pending against the firm or any associated person of the firm in connection with any audit report;

(G)copies of any periodic or annual disclosure filed by an issuer, broker, or dealer with the Commission during the immediately preceding calendar year which discloses accounting disagreements between such issuer, broker, or dealer and the firm in connection with an audit report furnished or prepared by the firm for such issuer, broker, or dealer; and

(H)such other information as the rules of the Board or the Commission shall specify as necessary or appropriate in the public interest or for the protection of investors.

(3)Consents

Each application for registration under this subsection shall include—

(A)a consent executed by the public accounting firm to cooperation in and compliance with any request for testimony or the production of documents made by the Board in the furtherance of its authority and responsibilities under this subchapter (and an agreement to secure and enforce similar consents from each of the associated persons of the public accounting firm as a condition of their continued employment by or other association with such firm); and

(B)a statement that such firm understands and agrees that cooperation and compliance, as described in the consent required by subparagraph (A), and the securing and enforcement of such consents from its associated persons, in accordance with the rules of the Board, shall be a condition to the continuing effectiveness of the registration of the firm with the Board.

(c)Action on applications

(1)Timing

The Board shall approve a completed application for registration not later than 45 days after the date of receipt of the application, in accordance with the rules of the Board, unless the Board, prior to such date, issues a written notice of disapproval to, or requests more information from, the prospective registrant.

(2)Treatment

A written notice of disapproval of a completed application under paragraph (1) for registration shall be treated as a disciplinary sanction for purposes of section 7215(d) and 7217(c) of this title.

(d)Periodic reports

Each registered public accounting firm shall submit an annual report to the Board, and may be required to report more frequently, as necessary to update the information contained in its application for registration under this section, and to provide to the Board such additional information as the Board or the Commission may specify, in accordance with subsection (b)(2).

(e)Public availability

Registration applications and annual reports required by this subsection, or such portions of such applications or reports as may be designated under rules of the Board, shall be made available for public inspection, subject to rules of the Board or the Commission, and to applicable laws relating to the confidentiality of proprietary, personal, or other information contained in such applications or reports, provided that, in all events, the Board shall protect from public disclosure information reasonably identified by the subject accounting firm as proprietary information.

(f)Registration and annual fees

The Board shall assess and collect a registration fee and an annual fee from each registered public accounting firm, in amounts that are sufficient to recover the costs of processing and reviewing applications and annual reports.

Notes & Related Subsidiaries

Editorial Notes

Amendments

2010—Subsec. (a). Pub. L. 111–203, § 982(c)(1), substituted “It” for “Beginning 180 days after the date of the determination of the Commission under section 7211(d) of this title, it”. Subsec. (b)(2)(A). Pub. L. 111–203, § 982(c)(2)(A), substituted “issuers, brokers, and dealers” for “issuers”. Subsec. (b)(2)(B), (G). Pub. L. 111–203, § 982(c)(2)(B), substituted “issuer, broker, or dealer” for “issuer” wherever appearing.

Statutory Notes and Related Subsidiaries

Effective Date

of 2010 AmendmentAmendment by Pub. L. 111–203 effective 1 day after July 21, 2010, except as otherwise provided, see section 4 of Pub. L. 111–203, set out as an

Effective Date

note under section 5301 of Title 12, Banks and Banking.

§7212 Registration with the Board

Summary

Title 15, §7212

Notes & Related Subsidiaries

Editorial Notes

Amendments

Statutory Notes and Related Subsidiaries

Effective Date

Effective Date

Citations & Metadata