PCAOB Staff Virtual Roundtable on NOCLAR Proposal

Moderators: Barbara Vanich, Chief Auditor and Director of the Office of the Chief Auditor (OCA), Dr. Martin C. Schmalz, Chief Economist and Director of the Office of Economic and Risk Analysis (OERA), and Dr. Karthik Ramanna, who serves as an adviser to OCA while on leave from Oxford University.

Panelists: See complete agenda and bios below.

Panel I – Identification

Panel II – Considerations for an Auditor’s Assessment of Noncompliance and Other Legal Considerations

Panel III – Economic Impacts

Agenda: Roundtable Discussion of Proposed Amendments to PCAOB Auditing Standards Related to a Company’s Noncompliance with Laws and Regulations (NOCLAR) 

Wednesday, March 6, 2024

• For specific questions to be addressed and additional background information on the topics listed below, please find a PCAOB staff briefing paper here.
  

Panelists Bios

D. Keith Bell, Senior Vice President, Finance, The Travelers Companies, Inc.

D. Keith Bell is Senior Vice President, Accounting Policy, Corporate Finance at The Travelers Companies, Inc. He is responsible for setting accounting policy, monitoring the development of accounting and regulatory reporting standards, and interacting with accounting standard setters as well as domestic and international insurance regulators on financial matters. Prior to joining Travelers, he held similar responsibilities at Aetna, Inc. (formerly Aetna Life & Casualty).

Mr. Bell has worked in the insurance and financial services industry for over thirty-five years and is a member of the American Institute of Certified Public Accountants. He is chairman of the American Property Casualty Insurance Association Financial and Regulatory Committee, a former member of the Federal Reserve Insurance Policy Advisory Committee, a member of the U.S. Treasury Advisory Committee on Risk-Sharing Mechanisms, a member of the Sustainability Accounting Standards Board Standards Advisory Group for the financial sector, former Chairman of the Board of Directors of the National Conference of Insurance Guaranty Funds, a member of the AICPA Insurance Expert Panel, and a member of the AICPA/National Association of Insurance Commissioners Task Force.

Doug Carmichael, Claire and Eli Mason Professor, Baruch College, CUNY

Doug Carmichael has headed the auditing standard setting staff at both the Public Company Accounting Oversight Board and the American Institute of Certified Public Accountants. He drafted and participated in the development of both of the prior auditing standards on the auditor's responsibility related to illegal acts. He has worked as an auditor, educator, regulator, consultant, and author. He has developed practice manuals for auditors that provide guidance on the detection, assessment, and disclosure of illegal acts.

Doug Carmichael is the Claire and Eli Mason Professor of Accountancy at Baruch College (CUNY), author of widely used practice manuals for CPA firms, and a consultant to such firms, as well as a litigation consultant to attorneys.  He is the only person to have ever served as both Chief Auditor of the PCAOB (the Board) and Vice President, Auditing of the AICPA in charge of writing professional standards.

John Coates, John F. Cogan, Jr. Professor of Law and Economics at Harvard Law School, Harvard Law School

John Coates is the John F. Cogan, Jr. Professor of Law and Economics at Harvard Law School, where he also serves as Deputy Dean and Research Director of the Center on the Legal Profession. Professor Coates served as General Counsel and as Acting Director for the Division of Corporation Finance for the U.S. Securities and Exchange Commission (SEC). Before joining Harvard, he was a partner at Wachtell, Lipton, Rosen & Katz, specializing in financial institutions and M&A. At Harvard Law School and at Harvard Business School, he teaches corporate governance, Mergers & Acquisitions, finance, and related topics. He has testified before Congress, advised the U.S. Department of Justice, the U.S. Department of Treasury, and the New York Stock Exchange, and served as the Chair of the Investor-as-Owner Subcommittee of the Investor Advisory Committee of the SEC.

Brian T. Croteau, U.S. Chief Auditor and Auditing Services Leader, PricewaterhouseCoopers (PwC)

Brian Croteau is U.S. Chief Auditor and Auditing Services Leader, PricewaterhouseCoopers(PwC). Prior to rejoining PwC in 2017, he served for over six years as the Deputy Chief Accountant of the Professional Practice Group within the Office of the Chief Accountant (OCA) at the U.S. Securities and Exchange Commission in Washington, DC. Mr. Croteau has also previously served as a Senior Associate Chief Accountant in OCA from 2004 to 2007. In his current position as PwC’s U.S. Chief Auditor and Auditing Services Leader, he plays a key role in the firm’s efforts focused on driving and monitoring audit quality. Mr. Croteau is a Certified Public Accountant, and he is a member of the American Institute of Certified Public Accountants. He earned his B.B.A. in accounting from the University of Massachusetts at Amherst.

Emily Fitts, Partner Deloitte & Touche LLP

Emily Fitts is a Partner in Deloitte & Touche LLP’s National Office, Audit & Assurance Services Group. In her current role, she is responsible for the application of auditing standards and the development and implementation of strategies to enhance quality across the Audit & Assurance practice. She also specializes in regulatory matters and standard setting and performs engagement quality reviews of public companies. From 2016 to 2019, Emily served as a Professional Accounting Fellow in the Professional Practice Group within the Office of the Chief Accountant (OCA) at the U.S. Securities and Exchange Commission in Washington, DC. She is a Certified Public Accountant and a member of the American Institute of Certified Public Accountants. She earned her B.S. in Accounting and her M.A. in Business Measurement and Assurance from the University of South Carolina.

Colleen Honigsberg, Professor of Law, Stanford Law School

Colleen Honigsberg is Professor of Law and Associate Dean of Curriculum at Stanford Law School, where her research is focused on the empirical study of corporate and securities law. Her recent papers have examined gaps in the regulatory environment for financial advisors, carbon accounting, human capital accounting, and the incentive structure for auditors. Prior to joining the faculty in 2016, Professor Honigsberg received her Ph.D. from the Columbia Business School and her J.D. from the Columbia Law School. She has expertise in accounting and previously worked as a Certified Public Accountant for PricewaterhouseCoopers Advisory Services and for Compass Lexecon. In addition, she previously served as a Senior Economic Research Fellow with the Public Company Accounting Oversight Board. She currently sits on the U.S. Securities and Exchange Commission’s Investor Advisory Committee.

Robert J. Jackson, Jr., Professor of Law and Co-Director of the Institute for Corporate Governance and Finance, New York University School of Law

Robert J. Jackson, Jr. is Professor of Law and Co-Director of the Institute for Corporate Governance and Finance at the New York University School of Law. He was nominated and confirmed to be Commissioner of the U.S. Securities and Exchange Commission in 2017 and served in that role until 2020.

Josh Jones, Americas Director of Audit and Chief Auditor, Ernst & Young

Josh Jones currently serves as Ernst & Young’s US Americas Director of Audit and Chief Auditor and is based in Tysons, VA. In that role, Josh leads efforts focused on developing and maintaining audit policy, methodology, guidance, tools and training for EY’s audit engagement teams. He also concentrates on monitoring and responding to the standard-setting activities of the Public Company Accounting Oversight Board, the American Institute of Certified Public Accountants and the U.S. Securities and Exchange Commission (SEC). Additionally, Josh oversees EY’s guidance and consultation to audit engagement teams on auditing and reporting matters, and other attestation engagements; including auditing, evaluating and reporting on internal control over financial reporting related matters. Josh was formerly a Senior Associate Chief Accountant in the SEC’s Office of the Chief Accountant, specializing in the SEC’s guidance related to the evaluation of internal control over financial reporting and auditing matters related to public companies.

Jonathan Karpoff, Washington Mutual Endowed Chair in Innovation and Professor of Finance, University of Washington

Jonathan M. Karpoff is the Washington Mutual Endowed Chair in Innovation and Professor of Finance at the University of Washington’s Foster School of Business. Jon’s research seeks insight into puzzles and problems from many walks of life, from salmon fisheries to corporate misconduct to polar exploration. A recent study (published in PLOS Biology) finds that Jon’s research impact ranks in the top 1% of all scientists worldwide. Jon also loves teaching and learning from students, and at the Foster School’s Executive MBA and PhD programs, he has received 13 teaching and mentorship awards since 2013. Jon also is an Associate Editor for The Journal of Finance and Journal of Financial and Quantitative Analysis, serves on the boards for the Financial Economists Roundtable and the Society for Financial Studies, and recently initiated a new mentoring project for the American Finance Association’s Committee on Racial Diversity.

For information on Jon’s research or teaching materials, or a link to his personal site, visit his UW page, SSRN page, or Google Scholar page.

R. Brad Martin, Vice Chairman, FedEx Corporation

R. Brad Martin is Vice Chairman of the Board of Directors of FedEx Corporation.

Martin is the Retired Chairman and CEO of Saks Incorporated, having served nearly 20 years in that role at Saks and its predecessor company. He led the enterprise from a 10-store base with annual revenues of approximately $70 million to become one of the largest department store businesses in the United States. During his service as Chairman & CEO, the value of the company increased substantially.

Martin co-founded Corporate Child Care, Inc., which became a public company and subsequently merged with Bright Horizons. He has served on the Board of a number of other public and private companies, including lululemon athletica, Dillard’s, First Horizon Corporation, Gaylord Hotels, and Chesapeake Energy Company.

Martin founded Hope 2 Hire, a job-training program operating in the Tennessee corrections system. He served five terms as a member of the Tennessee House of Representatives and one year as Interim President of the University of Memphis.

Martin holds a Bachelor's degree from the University of Memphis, an MBA from Vanderbilt, and an Honorary Doctor of Letters from the University of Memphis. He is a member of the Council on Foreign Relations.

Dennis McGowan, Vice President, Professional Practice, Center for Audit Quality

Dennis J. McGowan, CPA is the Vice President, Professional Practice and Anti-Fraud Initiatives at the Center for Audit Quality. In this role he leads regulatory and policy strategies that foster high-quality performance by public company auditors.

His duties include leading a team of audit executives to advance technical and policy-oriented projects to identify, develop, and seek consensus on issues affecting the public company auditing profession. McGowan is also responsible for overseeing the CAQ’s anti-fraud initiatives. This includes engaging with senior leaders across the financial reporting ecosystem, drafting comment letter responses to regulators, developing thought leadership publications, and responding to technical inquiries.

Dennis serves as a Board Member of Annapolis Pride, an organization dedicated to celebrating the LGBTQ+ community in Annapolis. Before joining the CAQ, he spent a decade at PricewaterhouseCoopers LLP, where he specialized in auditing clients in the financial services industry.

Dennis is a Certified Public Accountant licensed in Pennsylvania, and he holds a B.S. in Business Administration from La Salle University.

Carole McNees, CPA, Director of Quality Management, Ethics and Assurance Policy, Plante Moran

Carole McNees is a partner with Plante Moran and has over 25 years of experience in public accounting. As the firm’s Director of Quality Management, Ethics and Assurance Policy, and a member of its professional standard leadership team, she provides leadership to the firm’s assurance practice with respect to all aspects of assurance technical quality, including compliance with professional standards and risk management. Carole oversees the administration of the firm’s system of quality management, as well as the development of solutions to technical assurance issues through the implementation of policies, methodology, guidance and tools. Carole is also currently serving on the Michigan State Board of Accountancy. She’s a member of the American Institute of Certified Public Accountants and the Michigan Association of Certified Public Accountants and received her B.B.A. in accounting from Western Michigan University.

Kyle Owens, Partner, Auditing Standards, Crowe LLP 

Kyle is a professional practice standards partner in the national office of Crowe LLP and leads the assurance standards practice team. In his role, he focuses on the Public Company Accounting Oversight Board’s and the American Institute of Certified Public Accountant’s audit policy related matters including standard-setting activities, consultation and audit quality. He also significantly participates in Crowe’s development of audit methodology and related tools.

Christian Peo, National Managing Partner, Audit Quality and Professional Practice, KPMG

Christian Peo is responsible for the strategic oversight of audit quality, technical accounting & auditing, and the service delivery model of the audit practice for both KPMG LLP and KPMG Americas Ltd. During his career at KPMG, Christian has served as the lead partner or U.S. Securities and Exchange Commission (SEC) reviewing partner for a variety of clients, both public and private. He has served in a variety of national office roles, aimed at maintaining a positive, constructive relationship with regulatory agencies, overseeing national office initiatives, and assisting engagement teams in reaching appropriate accounting and auditing conclusions. He also spent two years as a Professional Accounting Fellow at the SEC. He holds a B.S. in accounting from Brigham Young University.

Sandra J. Peters, CPA, CFA Senior Head, Advocacy and Regulatory Relations

Sandra Peters leads the Financial Reporting Policy Group at CFA Institute where she oversees a team responsible for tracking all corporate disclosure, accounting, auditing, and environmental, social and corporate governance issues of interest to investors globally. Ms. Peters has an extensive and well-balanced background as a user advocate, preparer, and auditor. Most recently, she served as Vice President and Corporate Controller at MetLife Inc. Prior to joining MetLife, she was a partner at KPMG LLP providing audit services primarily for insurance and financial services companies. She has been a member of the International Financial Reporting Standards Interpretation’s Committee (IFRS IC), the Financial Accounting Standards Board’s Financial Accounting Standards Advisory Council and the Public Company Accounting Oversight Board’s Standing Advisory Group. Ms. Peters is a Certified Public Accountant licensed in New York, Texas, and Nebraska. She is a Certified Financial Analyst (CFA) and a member of CFA Society of New York. She holds a B.S./B.A. in accounting from the University of Nebraska and an MBA in finance from Indiana University.

Laura H. Posner, Partner, Cohen Milstein Sellers & Toll PLLC

Laura H. Posner is a partner at Cohen Milstein and a member of the firm’s Securities Litigation & Investor Protection and Ethics & Fiduciary Counseling practices.

Ms. Posner is a highly celebrated plaintiff-side securities litigator. Among other accolades, she’s been named a Law360 Securities MVP, to The National Law Journal’s Elite Women of the Plaintiffs Bar, Crain’s New York Business Notable Woman in Law, Benchmark's Hot List, Lawdragon's 500 Leading Lawyers, and the American Lawyer's Litigator of the Week.

Over the course of her career, Ms. Posner has recovered billions on behalf of defrauded investors. Her notable successes include 6 of the top 100 securities fraud class action settlements of all time. Most recently, she handled In re Wells Fargo & Company Securities Litigation, where she obtained $1 billion for investors, the 17th largest securities class action settlement ever and the largest ever without a restatement or related action by the U.S. Securities and Exchange Commission or Department of Justice. Her successes include a number of cases against public auditors, Including E&Y, KPMG, and RSM, and she is currently litigating a case against Deloitte related to SCANA Corporation – the largest fraud in South Carolina's history.

Prior to joining Cohen Milstein, Ms. Posner was the Bureau Chief for the New Jersey Bureau of Securities – the top Securities Regulator in New Jersey. Cases prosecuted under her direction resulted in hundreds of millions of dollars in recoveries for New Jersey residents, as well as more than 20 criminal convictions.

Ms. Posner is the President of the Institute for Law and Economic Policy and a member of the Public Policy Council of the CFP Board. She is the immediate past Chair and a current member of the NYC Bar Securities Litigation Committee, and the former Chair of the North American Securities Administrator’s Enforcement Committee.

Tom Quaadman, Executive Vice President, U.S. Chamber of Commerce Center for Capital Markets Competitiveness (CCMC), the Chamber Technology Engagement Center (C_TEC), and the Global Innovation Policy Center (GIPC)

Thomas Quaadman is the executive vice president of the U.S. Chamber Center for Capital Markets Competitiveness (CCMC), the Chamber Technology Engagement Center (C_TEC), and the Global Innovation Policy Center (GIPC).

CCMC was established in March 2007 to advocate legal and regulatory policies for the U.S. capital markets to advance the protection of investors, promote capital formation, and ensure U.S. leadership in the financial markets in the 21st century. Quaadman oversees the Center’s policy and lobbying operations. He also works with CCMC staff to create and execute legislative, regulatory, and judicial strategies to reform the financial regulatory system and support policies for efficient capital markets. Quaadman headed the Chamber’s efforts on the Dodd-Frank Wall Street Reform and Consumer Protection Act and the Jumpstart Our Business Start-Ups Act (JOBS Act). In addition, he formed and managed several coalitions, including the Corporate Governance Coalition for Investor Value and the FIRCA coalition on the convergence of domestic and international accounting rules. In directing the Chamber’s work on corporate governance, Quaadman led successful efforts to overturn the SEC’s proxy access rules and have a portion of the Conflict Minerals Rule declared unconstitutional.

He has testified on a number of occasions before congressional committees on issues covering capital formation, financial reporting, and corporate governance. He also led the business outreach efforts for the Working Group on U.S. RMB Clearing and Trading. In 2012, Treasury & Risk magazine named Quaadman as one of the top 100 influential people in finance. Quaadman graduated cum laude from New York Law School and is a graduate of the College of Staten Island. He is a member of the New York and Connecticut state bars.

Brandon Rees, Deputy Director of Corporations and Capital Markets, AFL-CIO

Brandon Rees is the Deputy Director of Corporations and Capital Markets for the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO). The AFL-CIO is a federation of labor unions that represent 12.5 million working men and women.

Bob Temple, General Counsel & Secretary, NuScale Power Corporation

Mr. Temple is the general counsel and board secretary for NuScale Power. His experience includes senior in-house positions with utilities and manufacturing companies, and private practice experience with Winston & Strawn, Hopkins & Sutter, McGuireWoods, and Haynes and Boone.

Lynn Turner, Senior Advisor, Hemming Morse

Lynn Turner, a Senior Advisor at Hemming Morse, has more than 45 years of auditing, business, regulatory, corporate governance, and academic experience related to financial reporting. He consults on complex investigations involving financial reporting, corporate governance, securities litigation, accountant and auditor liability, and technical accounting matters. Courts and the U.S. Congress recognize Lynn as an expert witness on financial reporting requirements, financial statement audits, and corporate governance standards and he has served as an arbitrator. In his former role as Chief Accountant for the U.S. Securities and Exchange Commission (SEC), Mr. Turner was the principal advisor to the SEC Chairman and Commissioners on a variety of matters, including the oversight and development of U.S auditing, financial reporting, corporate governance, accounting, and disclosure standards, as well as matters affecting audit committees of public companies. He has also served as a trustee of investment funds.

Alan J. Wilson, Partner, WilmerHale, Chair of the Law and Accounting Committee of the American Bar Association (ABA) Business Law Section

Alan J. Wilson is a corporate partner at WilmerHale who routinely advises public company clients and their boards on a variety of matters concerning corporate governance, compliance with federal securities laws, crisis situations and internal investigations. He has particular focus regarding the intersection between law and accounting and has extensive experience in U.S. Securities and Exchange Commission reporting and disclosure requirements, capital markets transactions, proxy and annual meeting matters, shareholder activism and engagement, shareholder proposals and environmental, social, and corporate governance matters.

Mr. Wilson’s securities counseling practice includes advising on Exchange Act disclosure obligations, Section 16 reporting, Rule 144, stock exchange listing standards, and internal control over financial reporting. Additionally, he frequently represents clients in securities and auditor enforcement matters before the U.S. Securities and Exchange Commission, Public Company Accounting Oversight Board, and state boards of accountancy.

Mr. Wilson’s professional activities are deeply connected to the legal aspects of accounting and auditing. He is the Chair of the Law and Accounting Committee of the American Bar Association (ABA) Business Law Section, former Vice Chair of the Audit Responses Committee of the ABA Business Law Section, and an ABA-appointed member of the National Conference of Lawyers and CPAs. He is also a Massachusetts Certified Public Accountant and is a member of the Massachusetts Society of Certified Public Accountants and the American Academy of Attorney-Certified Public Accountants. Previously, Mr. Wilson worked as an audit/state and local tax intern with KPMG in Pittsburgh, Pennsylvania.

Mr. Wilson is a frequent contributor to WilmerHale’s Keeping Current: Disclosure and Governance Developments blog. He also serves as the executive editor for securities law of the ABA’s Business Law Today.

Luigi Zingales, Distinguished Service Professor of Finance, University of Chicago

Luigi Zingales is a Distinguished Service Professor of Finance at the University of Chicago. Between 2013 and 2017, he was the founding director of the Center for Economic Analysis of the Public Company Accounting Oversight Board. In 2014, he was President of the American Finance Association. He co-hosts the popular podcast Capitalisn’t.