Broader View for Audit Oversight?

The PCAOB's Mark Olson and the EU's Charles McCreevy declare that increased cooperation and reliance on each other's work would save resources, red...
Dave Cook and Stephen TaubMarch 6, 2007

At a meeting on Tuesday, the heads of the audit oversight bodies for the United States and the European Union agreed to begin ”roadmap” discussions on cooperation, with the goal of full reliance on each other’s oversight systems by 2009.

Mark Olson, chairman of the Public Company Accounting Oversight Board, and Charles McCreevy, Internal Market Commissioner for the European Union, said in a joint statement that increased cooperation and reliance on the home-country regulator’s work would save resources, reduce regulatory overlap, and strengthen global confidence in audited financial statements.

Olson and McCreevy acknowledged that despite different frameworks, types of institutions, standards, and rules among the various countries involved, all desire better audit quality and restored confidence in financial reporting.

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Now that the PCAOB has entered its fifth year, noted Olson, it has some experience in the inspection and oversight of foreign issuers registered in the United States. Indeed, according to the statement, more than 760 non-U.S. firms from 83 countries, including about 265 companies based in the European Union, are registered with the PCAOB.

It makes sense, added Olson, that the board would consider how to ”further implement its international policy of cooperating with other regulators to the maximum extent possible.” He also stressed that it is important for regulators to find ways to “rely reasonably on each other in accomplishing our shared objective.”

In October, Olson and McCreevy will discuss the progress of the PCAOB’s policy guidance and the work on equivalency and other determinations under the EU’s Statutory Auditor Directive, according to the joint statement.