[Congressional Record Volume 171, Number 154 (Friday, September 19, 2025)]
[Senate]
[Page S6793]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. REED (for himself and Mr. Grassley):
  S. 2919. A bill to amend the Sarbanes-Oxley Act of 2002 to promote 
transparency by permitting the Public Company Accounting Oversight 
Board to allow its disciplinary proceedings to be open to the public, 
and for other purposes; to the Committee on Banking, Housing, and Urban 
Affairs.
  Mr. REED. Mr. President, the Public Company Accounting Oversight 
Board PCAOB Enforcement Transparency Act, which I am reintroducing 
today with Senator Grassley, will bring needed transparency to the 
disciplinary proceedings the PCAOB has brought against auditors and 
audit firms.
  Over two decades ago, in response to a series of massive financial 
reporting frauds particularly the Enron and WorldCom scandals, the 
Senate Banking Committee held multiple hearings, which found various 
underlying causes, including weak corporate governance, a lack of 
accountability, and inadequate oversight of accountants charged with 
auditing public companies' financial statements. Later, in a 99-to-0 
vote, the Senate passed the Sarbanes-Oxley Act of 2002 to address the 
structural weaknesses revealed by the hearings. Among its many 
provisions, this law called for the creation of an independent Board, 
the PCAOB, to oversee auditors of public companies in order to protect 
investors who rely on independent audit reports on the financial 
statements of public companies.
  Under the oversight of the U.S. Securities and Exchange Commission, 
SEC, the PCAOB oversees nearly 1,500 registered accounting firms, as 
well as the audit partners and staff who contribute to a firm's work on 
each audit. The Board's ability to begin proceedings that can determine 
whether there have been violations of its auditing standards or rules 
of professional practice is a crucial component of its oversight. 
However, unlike other oversight bodies, the Board's disciplinary 
proceedings cannot be made public without consent from the parties 
involved. Of course, parties subject to disciplinary proceedings have 
no incentive to consent to publicizing their alleged wrongdoing, and 
these proceedings are typically kept hidden from the public. 
Furthermore, the Board cannot publicize the results of its disciplinary 
proceedings until after the appeals process has been completely 
exhausted, which can often take several years.
  This lack of transparency invites abuse and undermines the 
congressional intent behind the PCAOB, which was to shine a bright 
light on auditing firms and practices, deter misconduct, and bolster 
the accountability of auditors of public companies to the investing 
public.
  Our bill will restore transparency and reaffirm Congress's intent, by 
making hearings by the PCAOB, and all related notices, orders, and 
motions, transparent and available to the public unless otherwise 
ordered by the Board. This would more closely align the PCAOB's 
procedures with those of the SEC for analogous matters.
  Increasing transparency and accountability of audit firms subject to 
PCAOB disciplinary proceedings strengthens investor confidence in our 
financial markets and better protects companies from problematic 
auditors. I urge our colleagues to join Senator Grassley and me in 
supporting this legislation to enhance transparency in the PCAOB's 
enforcement process.
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