November 8, 2021
SEC Approves PCAOB Rule under the Holding Foreign Companies Accountable Act
On Friday, the SEC announced that it approved the PCAOB’s Rule 6100, Board Determinations Under the Holding Foreign Companies Accountable Act. Rule 6100 establishes a framework for the PCAOB’s determinations under the Holding Foreign Companies Accountable Act (HCFAA) that the PCAOB is unable to inspect or investigate completely registered public accounting firms located in a foreign jurisdiction because of a position taken by an authority in that jurisdiction.
The HFCAA prohibits trading in a company’s stock if the company uses an audit firm for three consecutive years that a foreign jurisdiction prevents the PCAOB from inspecting completely, as determined by the PCAOB.
PCAOB Rule 6100 is effective immediately. In a statement issued on Friday, Chair Gensler noted that the Commission is on track to finalize by year-end the interim final rules that the Commission adopted earlier this year to implement the HFCAA.
– Dave Lynn