PCAOB Approves 2023 Budget, Strategic Plan to Protect Investors
Strategic plan outlines four goals: modernize standards, enhance inspections, strengthen enforcement, improve organizational effectiveness
At an open meeting held today, the Public Company Accounting Oversight Board approved its fiscal year 2023 budget and 2022-2026 strategic plan.
Informed by robust input from key stakeholders on the PCAOB’s advisory groups, the PCAOB’s staff, and the broader public through a comment solicitation process, the PCAOB’s strategic plan is built around four central goals to help the PCAOB fulfill its investor-protection mission:
- Modernizing standards;
- Enhancing inspections;
- Strengthening enforcement; and
- Improving organizational effectiveness.
“We are grateful to everyone who contributed to the development of this plan over the last several months. Working together, our efforts to modernize our standards, enhance our inspections, strengthen our enforcement, and improve our overall organizational effectiveness will further the PCAOB’s mission to protect investors,” said PCAOB Chair Erica Y. Williams.
The 2023 budget is guided by the strategic plan and provides the Board with the resources necessary to execute its goals to help keep investors protected. With core investments in people, processes, and technology, the budget is $349.5 million and provides funding for 926 positions. The PCAOB budget is subject to approval by the U.S. Securities and Exchange Commission.
Since January, the PCAOB has already made significant progress on the goals outlined under the strategic plan.
About one year into the current Board’s term, the PCAOB is working actively to update more than 30 standards within 10 standard-setting projects.
At the same time, as a result of this Board’s focus on strengthening enforcement, the PCAOB has more than doubled the total dollar amount of penalties imposed against individuals in 2022 as compared to each of the past five years. This includes breaking the record for the largest money penalty ever imposed on an individual in a settled case – twice.
The PCAOB has also quadrupled the average penalty against firms in cases where firms fail to meet PCAOB reporting requirements and increased the average penalties against firms in all other cases by about 50%. In the past five years, the PCAOB assessed penalties against individuals less than half of the time and firms only about 86% of the time. This year, it’s 100%.
The Board is also reimagining the PCAOB’s approach to stakeholder engagement and giving investors a seat at the table. Not only has the PCAOB established two new advisory groups – the Investor Advisory Group and the Standards and Emerging Issues Advisory Group – it has further elevated the voice of investors by hiring the first-ever Investor Advocate at the PCAOB.
The strategic plan and budget documents, along with such documents from previous years, are available on the PCAOB website.
About the PCAOB
The PCAOB is a nonprofit corporation established by Congress to oversee the audits of public companies in order to protect investors and further the public interest in the preparation of informative, accurate, and independent audit reports. The PCAOB also oversees the audits of brokers and dealers, including compliance reports filed pursuant to federal securities laws.
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