With today’s SCOTUS decision in Free Enterprise Fund v. PCAOB, the Public Accounting Oversight Board (“PCAOB”) survives but with less swagger and self-importance than before. This decision holding unconstitutional the “dual for-cause limitation” on the President’s ability to fire PCAOB members leaves the PCAOB’s form intact but downgrades its political independence. Continue reading
While I disagree with John McCain that Chris Cox should be “fired” over recent market turbulence, the D.C. Circuit Court of Appeal agrees with McCain that the SEC chair can be dismissed by the President of the United States. An unattributed ABCNews blog is reporting otherwise on the authority of an unnamed source. Continue reading
Today, a three-judge panel of the D.C. Circuit Court of Appeals handed down a much-anticipated 2-1 decision in Free Enterprise Fund v. PCAOB. The panel, in my view, reached the wrong conclusion, holding in essence that the PCAOB can rule over the world of U.S. accounting and auditing while immune from constitutional checks and balances. The crowning irony is that the PCAOB, supposedly designed to promote accountability, is itself so unaccountable for its actions.
Likely, the case will be reheard en banc and/or decided by the Supreme Court. Meanwhile, the best, most coherent reading is found in Judge Kavanaugh’s eloquent 57-page dissent: Continue reading
The securities law blogosphere has been bubbling with speculation — since the April 15 oral arguments in Free Enterprise Fund, et al. v. PCAOB — over how the D.C. Circuit Court might rule in the case. It is possible that the PCAOB and SOX could disappear in a cloud of appellate ink before summer’s end. Some observers, including the Washington Legal Foundation, believe it’s high time: Continue reading