NASHVILLE, TN (June 29, 2010) — The U.S. Supreme Court yesterday issued its decision in the case of Free Enterprise Fund v. the Public Company Accounting Oversight Board (PCAOB). The Supreme Court narrowly ruled 5 to 4 that the tenure of PCAOB members is unconstitutional, but held that “Board’s existence does not violate the separation of powers.” The National Association of State Boards of Accountancy (NASBA) commends the result of this decision. The opinion, written by Chief Justice Roberts, was apparently one of the last decisions to be released by the Court during this term.
The ruling is a substantial victory for the PCAOB as well as for NASBA and for State Boards of Accountancy, with whom the PCAOB has established a cooperative public protection relationship. Despite many predictions and fears, no large-scale adjustments from Congress will be necessary and the PCAOB will continue to operate.
The Court’s reasoning in the case reflects arguments NASBA advanced in the amicus curiae brief, filed by NASBA on behalf of the PCAOB.
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