Legislative Update: Senate Banking Committee Holds Hearing on PCAOB Audit Exemption Bill

June 26, 2018, the Senate Banking Committee considered The Small Business Audit Correction Act (S. 3004) at their hearing titled, “Legislative Proposals to Increase Access to Capital”.

  • At the hearing, the co-sponsors of S. 3004, Senators Tom Cotton (R-AR) and Doug Jones (D-AL) highlighted that the bill would provide common sense regulatory relief to small businesses by correcting an unintended consequences of the Dodd–Frank Act. 
  • Specifically, the Small Business Audit Correction Act  (S. 3004 and H.R. 6021) would exempt privately held, small non-custodial brokers and dealers in good standing from the requirements to hire a Public Company Accounting Oversight Board (PCAOB) registered audit firm to meet their annual SEA Rule 17a-5 reporting obligation and that the audit firm perform the audit in accordance with PCAOB standards.
  • Passage of the legislation would allow eligible firms to conduct their annual audits in a less costly and burdensome manner.

A transcript of the Senators’ comments on S. 3004 can be viewed here and an archived webcast of the hearing can be viewed here.

In related news, the House Financial Services Committee (FSC) was expected to markup H.R. 6021 tomorrow, however the meeting was postponed last minute. A markup is when the committee debates, amends, and votes to advance bills to the floor of the House or Senate.

We will keep you updated on when the FSC markup has been rescheduled.

Next Steps

The BDA, in partnership with Paige Pierce at PSP Consulting, will urge Members of the Senate Banking Committee to include and approve S. 3004 in a markup of bills by the Committee.

If you need any assistance with contacting your Member of Congress in support of the bill or would like more information,  please feel free to reach out to Joy Grewatz at (202)204-7908 or jgrewatz@bdamerica.org.