SEC. 2. DEFINITIONS.
(a) IN GENERAL. - In this Act, the following definitions shall apply:
(1) APPROPRIATE STATE REGULATORY AUTHORITY. - The term ‘‘appropriate
State regulatory authority’’ means the State agency or other authority
responsible for the licensure or other regulation of the practice of accounting
in the State or States having jurisdiction over a registered public accounting
firm or associated person thereof, with respect to the matter in question.
(2) AUDIT. - The term ‘‘audit’’ means
an examination of the financial statements of any issuer by an independent public
accounting firm in accordance with the rules of the Board or the Commission
(or, for the period preceding the adoption of applicable rules of the Board
under section 103, in accordance with then-applicable generally accepted auditing
and related standards for such purposes), for the purpose of expressing an opinion
on such statements.
(3) AUDIT COMMITTEE. - The term ‘‘audit committee’’
means -
(A) a committee (or equivalent body) established by and amongst
the board of directors of an issuer for the purpose of overseeing the accounting
and financial reporting processes of the issuer and audits of the financial
statements of the issuer; and
(B) if no such committee exists with respect to an issuer,
the entire board of directors of the issuer.
(4) AUDIT REPORT. - The term ‘‘audit report’’
means a document or other record -
(A) prepared following an audit performed for purposes of
compliance by an issuer with the requirements of the securities laws; and
(B) in which a public accounting firm either -
(i) sets forth the opinion of that firm regarding a financial
statement, report, or other document; or
(ii) asserts that no such opinion can be expressed.
(5) BOARD. - The term ‘‘Board’’ means
the Public Company Accounting Oversight Board established under section 101.
(6) COMMISSION. - The term ‘‘Commission’’
means the Securities and Exchange Commission.
(7) ISSUER. - The term ‘‘issuer’’
means an issuer (as defined in section 3 of the Securities Exchange Act of 1934
(15 U.S.C. 78c)), the securities of which are registered under section 12 of
that Act (15 U.S.C. 78l), or that is re quired to file reports under section
15(d) (15 U.S.C. 78o(d)), or that files or has filed a registration statement
that has not yet become effective under the Securities Act of 1933 (15 U.S.C.
77a et seq.), and that it has not with drawn.
(8) NON-AUDIT SERVICES. - The term ‘‘non-audit
serv ices’’ means any professional services provided to an issuer
by a registered public accounting firm, other than those provided to an issuer
in connection with an audit or a re view of the financial statements of an issuer.
(9) PERSON ASSOCIATED WITH A PUBLIC ACCOUNTING FIRM. -
(A) IN GENERAL. - The terms ‘‘person associated
with a public accounting firm’’ (or with a ‘‘registered
public accounting firm’’) and ‘‘associated person of
a public accounting firm’’ (or of a ‘‘registered public
accounting firm’’) mean any individual proprietor, partner, shareholder,
principal, accountant, or other professional employee of a public accounting
firm, or any other independent contractor or entity that, in connection with
the preparation or issuance of any audit report
(i) shares in the profits of, or receives compensation in
any other form from, that firm; or
(ii) participates as agent or otherwise on behalf of such
accounting firm in any activity of that firm
(B) EXEMPTION AUTHORITY. - The Board may, by rule, exempt
persons engaged only in ministerial tasks from the definition in subparagraph
(A), to the extent that the Board determines that any such exemption is consistent
with the purposes of this Act, the public interest, or the protection of investors.
(10) PROFESSIONAL STANDARDS. - The term ‘‘professional
standards’’ means -
(A) accounting principles that are -
(i) established by the standard setting body described in
section 19(b) of the Securities Act of 1933, as amended by this Act, or prescribed
by the Commission under section 19(a) of that Act (15 U.S.C. 17a(s)) or section
13(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78a(m)); and
(ii) relevant to audit reports for particular issuers, or
dealt with in the quality control system of a particular registered public accounting
firm; and
(B) auditing standards, standards for attestation engagements,
quality control policies and procedures, ethical and competency standards, and
independence standards (including rules implementing title II) that the Board
or the Commission determines -
(i) relate to the preparation or issuance of audit reports
for issuers; and
(ii) are established or adopted by the Board under section
103(a), or are promulgated as rules of the Commission.
(11) PUBLIC ACCOUNTING FIRM. - The term ‘‘public
accounting firm’’ means -
(A) a proprietorship, partnership, incorporated association,
corporation, limited liability company, limited liability partnership, or other
legal entity that is engaged in the practice of public accounting or preparing
or issuing audit reports; and
(B) to the extent so designated by the rules of the Board,
any associated person of any entity described in subparagraph (A).
(12) REGISTERED PUBLIC ACCOUNTING FIRM. - The term ‘‘registered
public accounting firm’’ means a public accounting firm registered
with the Board in accordance with this Act.
(13) RULES OF THE BOARD. - The term ‘‘rules of
the Board’’ means the bylaws and rules of the Board (as submitted
to, and approved, modified, or amended by the Commission, in accordance with
section 107), and those stated policies, practices, and interpretations of the
Board that the Commission, by rule, may deem to be rules of the Board, as necessary
or appropriate in the public interest or for the protection of investors.
(14) SECURITY. - The term ‘‘security’’
has the same meaning as in section 3(a) of the Securities Exchange Act of 1934
(15 U.S.C. 78c(a)).
(15) SECURITIES LAWS. - The term ‘‘securities
laws’’ means the provisions of law referred to in section 3(a)(47)
of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(47)), as amended by
this Act, and includes the rules, regulations, and orders issued by the Commission
thereunder.
(16) STATE. - The term ‘‘State’’ means
any State of the United States, the District of Columbia, Puerto Rico, the Virgin
Islands, or any other territory or possession of the United States.
(b) CONFORMING AMENDMENT. - Section 3(a)(47) of the Securities Exchange Act
of 1934 (15 U.S.C. 78c(a)(47)) is amended by inserting ‘‘the Sarbanes-Oxley
Act of 2002,’’ before ‘‘the Public’’.
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