I support our seeking public comment on the proposing release as set forth before us today, addressing a potential new rule governing our responsibilities under the Holding Foreign Companies Accountable Act (“HFCAA”).
Robust inspections and investigations of registered audit firms auditing US public companies are core to our mandate under the Sarbanes Oxley Act, whether such firms are located in or outside the United States. Through passage of the HFCAA, Congress has reaffirmed the importance of our oversight activities in providing protection for all investors of US public companies, regardless of where audit firms are located or audits are performed.
If ultimately adopted, the proposed rule would establish a framework for the determinations we are required to make under HFCAA, helping to promote consistency in our determinations over time and providing transparency to investors, firms, issuers, and other market participants as to the factors the Board would consider and the process the Board would use in making its determinations.
While the proposed rule provisions are well informed by our long history of constructive cross-border cooperation with virtually all our foreign counterparts, in the release we are seeking input on a number of elements of the proposed rule. I encourage investors, firms, issuers, and other key stakeholders to provide us your feedback. I am particularly interested in perspectives as to whether the proposal provides sufficient transparency of and sufficient timely reassessments of the Board’s determinations. These topics are addressed in section III.D.2 (e.g., question n) and section III.E (e.g., question r) of the release.
In closing, I want to recognize and thank all those who have contributed to developing today’s proposal, including our colleagues at the SEC; and with special recognition of our PCAOB staff in the Offices of International Affairs, Economic and Risk Analysis, and General Counsel.