The SEC’s plan to dedicate more staff to investigate audit lapses has triggered fresh uncertainty over the role of the industry’s embattled watchdog.
Through a series of job postings and a few public statements, the US Securities and Exchange Commission has promised to create a specialized unit to put extra power behind its auditor oversight, targeting what one official described as “fundamental” failures.
Investor advocates said they fear the move could hollow out the enforcement capabilities of the Public Company Accounting Oversight Board, which Congress stood up to ensure investors could rely on corporate financial reporting after the collapse of Enron Corp. and WorldCom Inc. in the early 2000s.
Accountants’ defense lawyers, meanwhile, are watching for clues about the full scope of the specialty unit’s work and what new risks the shifting accountability landscape might introduce for auditors.
Source: SEC Audit Oversight Push Renews Questions for Enron-Era Watchdog