Collapse to view only § 7202. Commission rules and enforcement
§ 7201. DefinitionsExcept as otherwise specifically provided in this Act, in this Act, the following definitions shall apply:
(1) Appropriate State regulatory authority
(2) Audit
(3) Audit committeeThe term “audit committee” means—
(A) a committee (or equivalent body) established by and amongst the board of directors of an issuer for the purpose of overseeing the accounting and financial reporting processes of the issuer and audits of the financial statements of the issuer; and
(B) if no such committee exists with respect to an issuer, the entire board of directors of the issuer.
(4) Audit reportThe term “audit report” means a document or other record—
(A) prepared following an audit performed for purposes of compliance by an issuer with the requirements of the securities laws; and
(B) in which a public accounting firm either—
(i) sets forth the opinion of that firm regarding a financial statement, report, or other document; or
(ii) asserts that no such opinion can be expressed.
(5) Board
(6) Commission
(7) Issuer
(8) Non-audit services
(9) Person associated with a public accounting firm
(A) In generalThe terms “person associated with a public accounting firm” (or with a “registered public accounting firm”) and “associated person of a public accounting firm” (or of a “registered public accounting firm”) mean any individual proprietor, partner, shareholder, principal, accountant, or other professional employee of a public accounting firm, or any other independent contractor or entity that, in connection with the preparation or issuance of any audit report—
(i) shares in the profits of, or receives compensation in any other form from, that firm; or
(ii) participates as agent or otherwise on behalf of such accounting firm in any activity of that firm.
(B) Exemption authority
(C) Investigative and enforcement authorityFor purposes of sections 7202(c), 7211(c), 7215, and 7217(c) of this title and the rules of the Board and Commission issued thereunder, except to the extent specifically excepted by such rules, the terms defined in subparagraph (A) shall include any person associated, seeking to become associated, or formerly associated with a public accounting firm, except that—
(i) the authority to conduct an investigation of such person under section 7215(b) of this title shall apply only with respect to any act or practice, or omission to act, by the person while such person was associated or seeking to become associated with a registered public accounting firm; and
(ii) the authority to commence a disciplinary proceeding under section 7215(c)(1) of this title, or impose sanctions under section 7215(c)(4) of this title, against such person shall apply only with respect to—(I) conduct occurring while such person was associated or seeking to become associated with a registered public accounting firm; or(II) non-cooperation, as described in section 7215(b)(3) of this title, with respect to a demand in a Board investigation for testimony, documents, or other information relating to a period when such person was associated or seeking to become associated with a registered public accounting firm.
(10) Professional standardsThe term “professional standards” means—
(A) accounting principles that are—
(i) established by the standard setting body described in section 19(b) of the Securities Act of 1933 [15 U.S.C. 77s(b)], or prescribed by the Commission under section 19(a) of that Act [15 U.S.C. 77s(a)] or section 78m(b) of this title; and
(ii) relevant to audit reports for particular issuers, or dealt with in the quality control system of a particular registered public accounting firm; and
(B) auditing standards, standards for attestation engagements, quality control policies and procedures, ethical and competency standards, and independence standards (including rules implementing title II) that the Board or the Commission determines—
(i) relate to the preparation or issuance of audit reports for issuers; and
(ii) are established or adopted by the Board under section 7213(a) of this title, or are promulgated as rules of the Commission.
(11) Public accounting firmThe term “public accounting firm” means—
(A) a proprietorship, partnership, incorporated association, corporation, limited liability company, limited liability partnership, or other legal entity that is engaged in the practice of public accounting or preparing or issuing audit reports; and
(B) to the extent so designated by the rules of the Board, any associated person of any entity described in subparagraph (A).
(12) Registered public accounting firm
(13) Rules of the Board
(14) Security
(15) Securities laws
(16) State
(17) Foreign auditor oversight authority
(Pub. L. 107–204, § 2(a), July 30, 2002, 116 Stat. 746; Pub. L. 111–203, title IX, §§ 929F(g)(1), 981(a), 982(a)(2), July 21, 2010, 124 Stat. 1854, 1926, 1928.)
§ 7202. Commission rules and enforcement
(a) Regulatory action
(b) Enforcement
(1) In general
(2) to (4) Omitted
(c) Effect on Commission authority
Nothing in this Act or the rules of the Board shall be construed to impair or limit—
(1) the authority of the Commission to regulate the accounting profession, accounting firms, or persons associated with such firms for purposes of enforcement of the securities laws;
(2) the authority of the Commission to set standards for accounting or auditing practices or auditor independence, derived from other provisions of the securities laws or the rules or regulations thereunder, for purposes of the preparation and issuance of any audit report, or otherwise under applicable law; or
(3) the ability of the Commission to take, on the initiative of the Commission, legal, administrative, or disciplinary action against any registered public accounting firm or any associated person thereof.
(Pub. L. 107–204, § 3, July 30, 2002, 116 Stat. 749.)