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Mix of Old and New Members are Named to Reconstituted PCAOB Advisory Groups

Soyoung Ho  Senior Editor, Accounting and Compliance Alert

Soyoung Ho  Senior Editor, Accounting and Compliance Alert

The PCAOB on May 9, 2022, announced inaugural members of its reconstituted advisory groups.

Some have served on the board’s previous advisory panels like former SEC chief accountant Lynn Turner, former SEC Corporation Finance (CorpFin) Director John White, and Sandra Peters of the CFA Institute. Others are newcomers to the groups like former FASB member Harold Schroeder.

The two new panels are the Investor Advisory Group (IAG) and the Standards and Emerging Issues Advisory Group (SEIAG). (See New PCAOB Leaders Unanimously Vote to Form Two Advisory Panels in the March 30, 2022, edition of Accounting & Compliance Alert.)

At least one member from the IAG would also serve on SEIAG. This is to enhance communications between the two advisory panels, the PCAOB said. However, no SEIAG member is on IAG.

There are “some new voices on the SEIAG, so there may be a little hope for fresh thinking,” said former FASB Chairman Dennis Beresford who previously served on the PCAOB’s Standing Advisory Group. However, “a lot of overlapping membership adds to the perception that the board really only cares about ‘investors’ views. This is reinforced by the announcement of an Investor Advocate position.”

Some believe that the old advisory panels were dominated by a few vocal individuals.

It appears that four IAG members will also serve on SEIAG: Lynn Turner, Sandra Peters, Jeffrey Mahoney, general counsel of the Council of Institutional Investors (CII), and Jennifer Joe, accounting professor at the University of Delaware.

The first meeting for IAG will be on June 8 while it is June 15 for SEIAG.

IAG Members

The following members have terms that expire at the end of 2023:

  • James Andrus, interim managing investment director, board governance & sustainability with the California Public Employees’ Retirement System (CalPERS)
  • Mary Bersot, CEO and chief investment officer of Bersot Capital Management
  • Jack Ciesielski, President & Portfolio Manager of R.G. Associates. He also serves on the FASB’s Emerging Issues Task Force (EITF)
  • Jennifer Joe, accounting professor at the University of Delaware
  • Christine O’Brien, head of investment stewardship, Elliott Investment Management L.P.
  • Sanford Rich, executive director of New York City Board of Education Retirement System
  • Gina Sanchez, founder and CEO of Chantico Global, a consulting firm
  • Harold Schroeder, distinguished executive-in-residence at Rutgers Business School. He served as a FASB member from 2011 to 2021
  • Lynn Turner, senior advisor at Hemming Morse LLP. He was the chief accountant from 1998 to 2001 when Arthur Levitt was chairman of the SEC, which oversees the PCAOB

These members’ terms expire at the end of 2024:

  • Alicia Damley, an investment and audit professional from Canada
  • Parveen Gupta, accounting professor at Lehigh University College of Business
  • Jeffrey Mahoney, general counsel at the Council of Institutional Investors (CII), was counsel to former FASB Chairman Dennis Beresford
  • Amy Copeland McGarrity, chief investment officer of Colorado Public Employees’ Retirement Association
  • Sandra Peters, senior head of global advocacy at CFA Institute. She also serves on the SEC’s Investor Advisory Committee (IAC)
  • David Pitt-Watson, visiting fellow at Cambridge Judge Business School. He is a former chair of the U.N. Environment Programme’s Finance Initiative
  • Nemit Shroff, accounting professor at MIT Sloan School of Management
  • Tony Sondhi, president of A.C. Sondhi & Associates, LLC. He previously served on the FASB’s EITF
  • Gary Walsh, principal with Luther King Capital Management

SEIAG Members

The following members’ terms expire at the end of 2023:

  • Christine Davine, national managing partner for quality, risk & regulatory at Deloitte & Touche LLP. She was previously a staff member in the SEC’s CorpFin
  • Susan DuRoss, executive director for global valuations, Harvest Investments. She was a member of the PCAOB Pricing Sources Task Force
  • David Fabricant, senior vice president and deputy controller of American Express
  • James Hunt, serves as a board of director of Brown & Brown, Inc., Subway Worldwide, Inc., and Penn Mutual Life Insurance Co. He was CFO of Walt Disney Parks and Resorts Worldwide
  • Jennifer Joe, accounting professor accounting at the University of Delaware
  • Josh Jones, Americas director of audit and chief auditor of Ernst & Young LLP. He was previously a senior associate chief accountant at the SEC
  • Melanie Senter Lubin, Maryland Securities Commissioner
  • Steven Morrison, partner with CohnReznick LLP. He previously served on the AICPA’s Auditing Standards Board, which writes audit standards for private companies
  • Dane Mott, accounting analyst at Capital Group Companies
  • Diane Rubin, board director of First Foundation Inc. She was vice chair of the board of trustees for the Financial Accounting Foundation (FAF)
  • Kecia Williams Smith, accounting professor at North Carolina A&T State University. She was previously an associate director at the PCAOB where she was involved in the inspections program
  • Lynn Turner, former SEC chief accountant. He is currently a senior adviser with Hemming Morse LLP

Terms expire at the end of 2024 for the following members:

  • John Bendl, principal and international CFO with Vanguard
  • Preeti Choudhary, accounting professor at University of Arizona. She previously was a senior economic research fellow in the PCAOB’s Office of the Economic Risk and Analysis
  • Brian Croteau, partner at PricewaterhouseCoopers LLP. He was a deputy chief accountant at the SEC, and he worked closely with the PCAOB in that role
  • Ron Edmonds, controller and vice president of controllers and tax for Dow. He is a member of the Financial Executives International’s Committee on Corporate Reporting and a member of the advisory council of the IFRS Foundation
  • Margaret Foran, chief governance officer, senior vice president, and corporate secretary of Prudential Financial, Inc.
  • Robert Hirth, senior managing director of Protiviti. He served as the co-vice chair of the Sustainability Accounting Standards Board (SASB). He was also the chairman of the Committee of Sponsoring Organizations of the Treadway Commission (COSO)
  • Robert Knechel, accounting professor at the University of Florida in Gainesville
  • Sara Lord, chief auditor of RSM US LLP
  • Jon Lukomnik, managing partner with Sinclair Capital
  • Jeffrey Mahoney, CII general counsel and former FASB counsel
  • Sandra Peters, senior head for global advocacy, CFA Institute
  • John White, partner of Cravath, Swaine & Moore LLP. He was SEC CorpFin director from 2006 to 2008.

“We are very grateful to the individuals who have stepped forward to serve on our advisory groups,” said PCAOB Chair Erica Williams in a statement. “The extraordinary expertise, experience, and perspective of the members of both these advisory groups will aid us immensely as we pursue our mission to protect investors and further the public interest.”

Investor Advocate

The PCAOB said that it is currently looking to hire an investor advocate, a position similar to the SEC’s investor advocate, which was created by Dodd-Frank. PL111-203

Board member Kara Stein was appointed acting IAG co-chair. “It is the Board’s intention that the Investor Advocate, once hired, would serve as the IAG’s Board-appointed Co-Chair,” the PCAOB said.

“Kara’s experience as an SEC Commissioner, where she advocated for strong investor protections and rules that put investors first, will serve the IAG well until we fill the Investor Advocate position,” Williams said.

Acting Chief Auditor Barbara Vanich will serve as the SEIAG Chair.

Their appointments come as the new board leadership has prioritized getting input from its advisory panels. During William Duhnke’s tenure as chairman of the PCAOB, critics said that the board barely held any advisory meetings.

Moreover, many criticized a new group the board set up in March last year while abolishing two previous advisory groups. Among other things, investor protection advocates said that investor views would be minimized. Moreover, they were concerned that the meetings will not be open to the public. (See As PCAOB Seeks New Adviser Nominations, Some Criticize Advisory Group’s Charter in the April 15, 2021, edition of ACA.)

 

This article originally appeared in the May 11, 2022 edition of Accounting & Compliance Alert, available on Checkpoint.

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