Activity Review
North Carolina State
Board of Certified Public
Accountant Examiners
1101 Oberlin Road, Suite 104, PO Box 12827, Ralegh, NC 27605 (919) 733-4222 Issue No. 7-2002
SEC Formally Proposes Framework of a
Public Accountability Board
Key provisionsoftheproposed rules
include:
On June 20, 2002, the Securities and
Exchange Commission (SEC) voted
unani mou si
у
to propose rul esto rdbrm
oversi ghtand i mproveaccountabi lity of
auditors of public companies, thereby
enhanci ng there! iability and i ntegri ty of
thefinancial reporting process.
The proposed rules establish the
framework for a Pu bl i c A ccou ntabi I i ty
Board (PA B)—asy stem of "privatesec-
tor" (but not "seif") regulation thatwould
notbeunderthecontrol oftheaccount-
ing profession.
The stru ctu rei s i ntend ed to su p pi e-
mentthe SEC's oversi ghtand enforce¬
ment efforts by expand i ng theopportu-
nitiestodetectand remedyethical lapses
or deficiencies in competence, thereby
comp I ementi ngtheSEC's enforcement
efforts.
“ I nvestor conf i d encei s the bed rock
of our markets, " said SEC Chairman
HarveyL.Pitt.
" I ndf ectj veoversi ghtof publi com¬
pany audits damages that confidence.
Our proposal will hd prestore investor
faith by ensuring strong and effective
reg u I ati on of theaccou nti ng prof essi on ."
"In putting forth this proposal, we
beg i n a p rocess that ensu res real change
beforeyear's end," explained Pitt.
The proposed rules are based on
extensive public input, including com¬
ments receved during a series of SEC-
sponsored Roundtables and the SEC's
first Investor Summit. The rule will be
open to comment for 60 d ay s after pub¬
li cation in the Federal Register.
Membership - To assure that the
benefits of the new regulatory regime
extend to i nvestors i n al I pu bl i c compa-
nies, thefinancial statements of SEC-
registered companies would not be
deemed to comply with SEC require¬
ments unless the company's outside
au di tors w ere member s of a P A
В
.
To ensu re that a PA
В
has access to
d i verse non-d i scred onary , f u ndi ng and
full information about audits, an SEC-
registered company's financial state
mentsal so would not comply with SEC
requirements unless the company was
an adjunct memberof, and thereby bound
tocooperatein any re/iew or proceed i ng
commenced by,thesamePABasitsac-
countants.
SEC Oversight - The SEC would
recognize a PAB after reviewing, and
be ngsati sfi ed with, among other thi ngs,
theentity'sproposed structure, charter,
by-l aws, rules, stated practi ces, proposed
budget, proposed board members, mem-
bershi p requi rements, systems, and pro-
cedures.
The SEC would also oversee selec¬
tion or termination of PA
В
board mem¬
bers, an d the au thori ty to revi ew , al ter,
mod i fy or abrogateany PA
В
ru I eor d i s-
ci pi inary sanction.
Public Accountability Board
continued on page 4
Exam Applications
Please note the following applica¬
tion d ead I i nesfortheN ov ember 2002
UniformCPA Examination:
Initial exam applicants
July 31, 2002
Re-exam applicants
August 30, 2002
Your compl eteap pi i cati on must
be postmarked or receved in the
Board offi ce before the appropri ate
deadline.
The exami nati on fee i s $250. 00,
regard I ess of the nu mber of secti ons
for which you aresitting. Your can¬
cel ed check or cred i t card statement
is proof only that your application
was received— it does not indicate
that your application has been ap¬
proved.
To obtain an exam application,
please call the Board's application
line (1-800-211-7930) or visit the
Board 's w eb site (www .state.nc.us/
cpabd).
Inside this issue...
Board Directory . 7
Board Meetings . 5
Certificates Issued . 5
Correction: Statement N o. 39 . 3
Declaratory Ruling . 3
Disci pi inary Actions . 2
Exam Grades . 4
NCDOR Issues Directives . 4
N otice of A dd ress C hange . 8
Reclassifications: Retired . 5
Reclassifications: Inactive . 6
