Audit Integrity and Job Protection Act

Bill: 113-s-1526
Sponsor: full_name: Sen. Toomey, Patrick [R-PA]
Introduced: 2013-09-19
Policy area: Finance and Financial Sector
Subjects: Accounting and auditing

Administrative law and regulatory procedures

Congressional oversight

Corporate finance and management

Financial services and investments

Government corporations and government-sponsored enterprises

Government studies and investigations

Securities
Latest action: action_date: 2013-09-19
text: Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Summaries:
action_date: 2013-09-19
action_desc: Introduced in Senate
text: <p>Audit Integrity and Job Protection Act - Amends the Sarbanes-Oxley Act of 2002 (SOX) to deny the Public Company Accounting Oversight Board any authority to require that audits conducted for a particular issuer of securities in accordance with SOX standards be conducted by specific registered public accounting firms, or that such audits be conducted for an issuer by different registered public accounting firms on a rotating basis. </p> <p>Directs the Comptroller General (GAO) to update the November 2003 report, "Study on the Potential Effects of Mandatory Audit Firm Rotation," and review the potential effects (including costs and benefits) of requiring the mandatory rotation of registered public accounting firms.</p> <p>Requires such update also to study: (1) whether mandatory rotation of registered public accounting firms would mitigate against potential conflicts of interest between registered public accounting firms and issuers; (2) whether such a mandatory rotation would impair audit quality due to the loss of industry or company-specific knowledge gained by a registered public accounting firm through years of experience auditing the issuer; and (3) what effect SOX has had upon registered public accounting firms' independence, and whether additional independence reforms are needed. </p>

tv_txt: II 113th CONGRESS 1st Session S. 1526 IN THE SENATE OF THE UNITED STATES September 19, 2013 Mr. Toomey (for himself and Mr. Manchin ) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To amend the Sarbanes-Oxley Act of 2002 to prohibit the Public Company Accounting Oversight Board from requiring public companies to use specific auditors or require the use of different auditors on a rotating basis.

1. Short title This Act may be cited as the Audit Integrity and Job Protection Act . 2. Limitation on authority relating to auditors Section 103 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7213) is amended by adding at the end the following: (e) Limitation on authority The Board shall have no authority under this title to require that audits conducted for a particular issuer in accordance with the standards set forth under this section be conducted by specific registered public accounting firms, or that such audits be conducted for an issuer by different registered public accounting firms on a rotating basis. . 3. Study of mandatory rotation of registered public accounting firms (a) Study and Review Required The Comptroller General of the United States shall update its November 2003 report entitled Study on the Potential Effects of Mandatory Audit Firm Rotation , and review the potential effects, including the costs and benefits, of requiring the mandatory rotation of registered public accounting firms. In addition, the update shall include a study of— (1) whether mandatory rotation of registered public accounting firms would mitigate against potential conflicts of interest between registered public accounting firms and issuers; (2) whether mandatory rotation of registered public accounting firms would impair audit quality due to the loss of industry or company-specific knowledge gained by a registered public accounting firm through years of experience auditing the issuer; and (3) what affect the Sarbanes-Oxley Act of 2002 has had on registered public accounting firms’ independence and whether additional independence reforms are needed. (b) Report Required Not later than 1 year after the date of enactment of this Act, the Comptroller General shall submit a report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives on the results of the study and review required by this section. (c) Definition For purposes of this section, the term mandatory rotation refers to the imposition of a limit on the period of years in which a particular registered public accounting firm may be the auditor of record for a particular issuer.