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The role of the Public Company Accounting and Oversight Board (PCAOB)

The role of the Public Company Accounting and Oversight Board (PCAOB)

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The role of the Public Company Accounting and Oversight Board (PCAOB)

PCAOB is an entity which was formed to play an oversight role over auditors of all public

companies, and it is not profit-oriented. This was aimed at protecting vulnerable investors from

unscrupulous and scandalous deals by the management of the public companies. Carmichael and

Lynford (34) assert that PCAOB does this role through the provision of comprehensive and

timely audit reports to investors and the public. The Securities and Exchange Commission (SEC)

do the role of overseeing the board in order to ensure transparency and accountability of all

information relayed by the board to the public domain. The roles of the board include registering

of the public accounting firms and ensuring companies comply with the Sarbanes-Oxley Act,

which created it in 2002 (Stimson, 45). In addition, the board plays a role in the establishment of

auditing, autonomy, ethical standards, control of quality of service delivery, conducting of

inspections, implementation of disciplinary obligations, and carrying out of investigations on

frauds and misappropriation of registered public company funds.

The board IS charged with the mandate of hiring and firing of members of the board,

approving the budget of the board, and the reviewing of the board’s inspection reports. PCAOB

ensures that there is compliance to the Sarbanes-Oxley Act, in order to have total quality

management in the public accounting sector. According to Bruno, Sabrina, and Eugenio (29), the

enquiries and investigations the board carries out aid in the establishment of variances and faults

in the checks and balance systems for rectification. This leads to improvement in the

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accountability of the shareholders’ capital net worth in the concerned companies. This also

serves as a measure for attracting of investors from all sectors to invest in the companies the

PCAOB approves. The board instills confidence in the public sector because its role as an

overseer of the operations of the public companies deters the companies’ personnel from

indulging in malpractices, which compromise the public sector quality standards.

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Name: Course: Professor: Date: The role of the Public Company Accounting and Oversight Board (PCAOB) PCAOB is an entity which was formed to play an oversight role over auditors of all public companies, and it is not profit-oriented. This was aimed at protecting vulnerable investors from unscrupulous and scandalous deals by the management of the public companies. Carmichael and Lynford (34) assert that PCAOB does this role through the provision of comprehensive and timely audit reports to investors and the public. The Securities and Exchange Commission (SEC) do the role of overseeing the board in order to ensure transparency and accountability of all information relayed by the board to the public domain. The roles of the board include registering of the public accounting firms and ensuring companies comply with the Sarbanes-Oxley Act, which created it in 2002 (Stimson, 45). In addition, t ...
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