The SEC has approved rules requiring public accounting firms registered with the Public Company Accounting Oversight Board to report events such as legal proceedings and changes in a firms contact information within 30 days to the PCAOB, as well as file annual reports on disciplinary matters and other issues.
The new PCAOB reporting rules take effect Oct. 12, 2009. "Adoption of these rules will put into effect an important provision of the Sarbanes-Oxley Act and increase transparency regarding firms registered with the PCAOB, including auditors of public companies and broker-dealers," said PCAOB Acting Chairman Daniel L. Goelzer in a statement.
Under the new rules, certain events occurring after Oct. 12 must be reported by a registered firm in a special report on PCAOB Form 3 within 30 days. If the events occurred between the time of a firms registration application and the Oct. 12 effective date, a firm must report those events in a special report on Form 3 within 30 days after the Oct. 12 effective date. Accordingly, the earliest potential deadline for any firms filing of a special report on Form 3 is Nov. 11, 2009.
In addition, the new rules require registered firms to file annual reports on Form 2, with the first annual reports being due June 30, 2010. Going forward, all firms that are registered with the PCAOB as of March 31 of a particular year must, by June 30 of that year, file an annual report covering the 12-month period ending March 31. Information to be reported annually includes, among other things, information about audit reports issued, disciplinary histories of new personnel, and certain information about fees billed to issuer audit clients for various categories of services.
Under the new rules, all firms registered as of March 31 of a given year must pay an annual fee by July 31 of that year. The PCAOB will announce the amount of the annual fee at a later date.
Finally, the new rules also govern the filing of an optional form, Form 4, that allows, in certain circumstances, for a firm to succeed to the registration status of a predecessor firm without a break in that registration status and without the need to file a new registration application on Form 1. Firms seeking to avail themselves of that option with respect to succession events that occurred before Oct. 12, 2009 would need to file Form 4 with respect to those events by Oct. 26, 2009.
The PCAOB said it would make each firms filings on Forms 2, 3, and 4 available to the public on the boards Web site promptly upon the filing of the form. Certain limited information reported to the PCAOB on those forms will not be made public, however, if it meets specified criteria for confidential treatment.
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