Convergence may not be that far off after all, here it is 2011 and now we finally have U.S. and U.K. audit harassment agencies working together to share information and polish up that whole bit about protecting investor confidence in capital markets. It may or may not have something to do with the collapse of Lehman Brothers (personally I think the paranoid mistrust in foreign accounting systems – or perhaps just ours – goes back a tad more than that) but soon enough the PCAOB will have an in (after at least one failed attempt) and get a chance to
harass inspect foreign firms. We anticipate that this announcement will bring it with it a fantastic new acronym so we can all keep track of who is who.
The Public Company Accounting Oversight Board today entered into a cooperative agreement with the Professional Oversight Board in the United Kingdom to facilitate cooperation in the oversight of auditors and public accounting firms that practice in the two regulators’ respective jurisdictions.
This agreement provides a basis for the resumption of PCAOB inspections of registered accounting firms that are located in the United Kingdom and that audit, or participate in audits, of companies whose securities trade in U.S. markets. The PCAOB previously conducted inspections in the United Kingdom with the POB from 2005 to 2008, but has been blocked from doing so since that time.
Acting PCAOB Chairman Daniel L. Goelzer welcomed the arrangement, which will lay the foundation for the PCAOB and POB to work together to promote public trust in the audit process and investor confidence in capital markets.
The PCAOB can thank the Dodd-Frank WSCRA which amended SOX to permit the PCAOB to share information with foreign audit agencies under certain conditions.
In light of this event, we’re wondering what happens when the two work together sharing “information.” Does it get a brand new acronym that celebrates this new dawn in inter-obnoxious-regulatory-gossiping (IORG) or does it become a hybrid acronym like the Public Professional Company Oversight^2 Board Board or PPCO^2BB? Surely we can do better.
Party at the PCAOB DC office this evening to celebrate, bring your own acronym suggestions and IFRS pocket guide.