The Public Company Accounting Oversight Board’s chief auditor and director of professional standards, Thomas Ray, has resigned and plans to return to the private sector on March 6.
Ray is joining KPMG as a partner in the firm's department of professional practice in New York. Ray was one of the members of the PCAOB’s first professional staff. He joined as deputy chief auditor in June 2003 soon after the PCAOB commenced operations. The Sarbanes-Oxley Act of 2002 established the board to oversee auditing firms of public companies in the wake of the Enron and WorldCom scandals that put firms like Arthur Andersen out of business.
Ray played a key role in establishing the PCAOB’s Office of the Chief Auditor, and in February 2006, he was appointed chief auditor. Ray oversaw the development of all of the auditing standards developed, proposed and adopted by the board. He was instrumental in designing the board’s auditing standards to implement Section 404 of Sarbanes-Oxley, which required public companies, for the first time, to obtain audits of the effectiveness of their internal controls over financial reporting, thereby helping detect fraud.
“We are sorry to see Tom leave, but we respect his decision to take on new challenges and opportunities,” said PCAOB Chairman Mark Olson in a statement. “He has been a superb member of the PCAOB’s leadership team with a substantial record of achievement. Investors have been well-served by Tom’s significant contributions to the PCAOB’s mission.”
Another significant auditing standard project in which Ray played a key role was the development of the suite of seven proposed new standards related to the auditor’s assessment of and response to risk in an audit. He was also actively involved in the development of the board’s ethics and independence rules and documents such as staff audit practice alerts.
“I believe we have been able to develop strong auditing standards that will serve to protect the public,” said Ray.
Prior to joining the PCAOB staff, Ray was a partner with KPMG in their department of professional practice in New York. Before that, he was director of auditing standards at the American Institute of CPAs. He began his public accounting career with Grant Thornton.
PCAOB deputy director Jennifer Rand will serve as acting chief auditor until a permanent appointment is made.
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