The Securities and Exchange Commission on Feb. 7, 2023, said that it is seeking candidates to serve as a board member on the Public Company Accounting Oversight Board.
The commission is looking to fill a CPA seat that will be open in October when board member Duane DesParte’s second term ends. The appointment will be for a five-year term from October 2023 to October 2028.
The Sarbanes-Oxley Act of 2002 established the PCAOB, and five voting board members are appointed by the SEC, which oversees the audit regulatory board. And three members must be non-CPAs and two are CPAs. The commission notes that the candidate selected “must be or have been” a CPA.
In terms of qualifications, the SEC said board members “must have a demonstrated commitment to the interests of investors and the public and an understanding of the responsibilities for and nature of the financial disclosures required of issuers, brokers, and dealers under the securities laws and the obligations of accountants with respect to the preparation and issuance of audit reports with respect to such disclosures.”
The SEC’s Office of the Chief Accountant (OCA) administers the PCAOB member selection process. SEC commissioners then vote on the recommended candidates.
DesParte was one of the five new members that the SEC appointed in December 2017 when Jay Clayton was chairman. Before assuming his PCAOB position in April 2018, he retired from Exelon Corp. where he was corporate controller.
DesParte was reappointed in May 2019, and current SEC Chair Gary Gensler designated him as acting chair in June 2021 after removing then PCAOB chairman William Duhnke. (See SEC Removes PCAOB Chairman Duhnke, Seeks to Fill All Board Member Positions in the June 7, 2021, edition of Accounting & Compliance Alert.)
DesParte served as acting chair until January 2022 when current PCAOB Chair Erica Williams was sworn in.
DesParte was the only board member who kept his job when the SEC under Gensler named four new board members in November 2021, including Williams. (See SEC Appoints Most Diverse PCAOB Members in the Nov. 9, 2021, edition of ACA.)
The following are the other current PCAOB members and their terms:
- Chair Erica Williams—current first term ends in October 2024
- Member Christina Ho—first term ends in October 2025, and she occupies the other CPA seat
- Member Kara Stein—fist term ends in October 2026
- Member Anthony Thompson—reappointed in June 2022, and his term expires in October 2027
In the past, PCAOB members routinely got second terms, almost like a guarantee. But Clayton broke tradition and decided not to grant second terms when he replaced all board members. And again, he denied a second term for Kathleen Hamm. (See SEC Denies Second Term for PCAOB Member Kathleen Hamm, Instead Appoints White House Staffer Rebekah Goshorn Jurata in the Oct. 15, 2019, edition of ACA.)
In the meantime, the application period for the coming vacant seat ends in one month.
The SEC said interested individuals who meet the statutory criteria should submit a cover letter, discussing the statutory qualifications and a current resume to Boardrecommendations@sec.gov, by March 7, 2023.
This article originally appeared in the Feb. 8, 2023 edition of Accounting & Compliance Alert, available on Checkpoint.
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