Newswise — Ronald R. King, senior Associate Dean and professor of accounting at Olin Business School, Washington University in St. Louis is available for comment on a case before the Supreme Court: Free Enterprise Fund and Beckstead & Watts, LLP, Petitioners v. Public Company Accounting Oversight Board (PCAOB).
King says the Supreme Court's decision in this case revolves around the constitutionality of the PCAOB. The PCAOB is a board designed to oversee auditing for publicly-traded firms and was created by Congress when it passed the Sarbanes-Oxley Act of 2002 (SOX).
To enhance PCAOB’s independence from political pressures, Congress established it as an independent agency, and gave oversight powers to the Securities and Exchange Commission (SEC), also an independent agency.
The plaintiffs in this case allege that Congress empowered the PCAOB with broad executive powers, yet limited the President’s ability to appoint Board members (thus violating the appointments clause of the constitution) and to control and/or remove Board members (thus violating the separation of powers doctrine of the constitution).
"The Supreme Court’s decision about the constitutionality of the PCAOB is important," explains King, "because of its potential impact on the future of auditing oversight, the validity of Sarbanes-Oxley and the future of Congressional ability to establish independent agencies in general."
Ronald R. King is senior associate dean at the Olin Business School and the Myron Northrop Professor of Accounting. He is available for comment on this case. ISDN and VYVX lines are available free of charge for broadcast quality recorded or live interviews from the Washington University news service studio.
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