Mark Olson, chairman of the Public Company Accounting Oversight Board, said he is resigning his post at the end of July, but did not elaborate on the reasons.
In a letter of resignation, Olson, 66, simply said, The decision is entirely personal and reflects my desire at this time of life to establish new priorities.
Olson was named PCAOB chairman on June 26, 2006, after serving on the board of governors of the Federal Reserve. The resignation will take effect after more than three years of service in the job, on July 31, 2009.
He was appointed by the SEC to run the board, which inspects accounting firms that perform audits on public companies. The PCAOB is also slated to begin inspecting accounting firms that audit non-public broker-dealers, such as the three-person accounting firm that audited Bernard Madoffs investment management firm.
The Sarbanes-Oxley Act of 2002 established the PCAOB in response to the Enron and WorldCom accounting scandals, but the U.S. Supreme Court has agreed to hear a case next term challenging the constitutionality of the board under the separation-of-powers principles and appointments clause of the Constitution. The plaintiff, the Free Enterprise Fund, claims the five members of the PCAOB should be appointed by the president and not by the SEC.
According to the PCAOB, Olson has no immediate plans after his resignation other than to resume his efforts to promote financial literacy.
The SEC will have to name a replacement not only for Olson, but also for two other members of the board whose terms are expiring. Charles Niemeier's term expired last October, but the SEC has not yet named a replacement, so he still serves on the board. Bill Gradison's term will be coming to a close in October of this year. Olson's term was not set to expire until October 2010. A source close to the situation speculated that the SEC may opt to name successors to all three men at the same time.
The Center for Audit Quality issued a statement praising Olson's tenure. In the past three years as chairman of the PCAOB, Mark Olson has demonstrated an ability to work with investors, auditors and others in promoting audits that are informative, fair and independent," said executive director Cindy Fornelli. "He is a public servant of the first order, and we commend him for his dedication to quality audits, which are a critical factor in preserving investor confidence in the strength and stability of our capital markets. In view of the still challenging economic environment, and in the midst of a challenging economic environment, we hope SEC Chairman Mary Schapiro will move with all due haste to appoint Chairman Olsons permanent successor at the PCAOB.
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