“To amend the Sarbanes-Oxley Act of 2002 to provide for disclosure regarding foreign jurisdictions that hinder inspections, and for other purposes.”
No CRS summary available for this bill.
This section amends PCAOB inspection requirements for registered public accounting firms auditing issuers from foreign jurisdictions by (1) defining a "compromised auditor" as an independent branch, office, or subsidiary of such a firm subject to the jurisdiction, control, influence, or compromising arrangements of a "covered country" (i.e., a country identified as a U.S. national security threat in the Director of National Intelligence's Annual Threat Assessment or a covered nation under 10 U.S.C. 4872(d)(2)); (2) making conforming changes to cross-references and inspection deferral provisions for compromised auditors; and (3) requiring trading prohibitions under existing law to apply to any covered issuer headquartered in a country of concern that retains a compromised auditor. (Thus, such issuers face potential delisting from U.S. exchanges if they continue using auditors whose inspections may be blocked or compromised due to foreign government interference.)
This section revises the public hearing requirements in disciplinary proceedings conducted by the Public Company Accounting Oversight Board (PCAOB) by replacing the prior presumption of public hearings (absent good cause for closure) with a presumption of nonpublic hearings. Under the new rules, hearings shall not be public unless (1) a compromised auditor (as defined in section 104(i)(1)) retained by a covered issuer (as defined therein) is a party to the hearing or (2) otherwise ordered by the Board for good cause shown, with the consent of the parties.