Early signs are pointing to John Biggs, chairman of the giant TIAA-CREF pension fund, as front-runner for the position of chairman of the new Public Company Accounting Oversight Board (PCAOB). Securities and Exchange Commission Chairman Harvey Pitt said he hopes the SEC will name the five members of the new oversight board by the end of the month, but said there is not yet an agreed list of appointees, according to a Reuters report.
However, Pitt said the SEC was narrowing down the field of contenders for chairman -and that he expected the SEC’s final selection to be a unanimous decision.
Former Federal Reserve Chairman Paul Volcker had been considered by many the favorite to head the board. However, according to the Reuters report, Volcker says he would not accept the role, saying there are more qualified people. Reuters said he mentioned Biggs specifically as a strong candidate.
Since Volcker bowed out, the SEC has been courting Biggs, as well as stock market regulator Mary Schapiro, according to Reuters, citing sources.
The PCAOB was created by the Sarbanes-Oxley Act (see Blackout Rules Ride With Accounting Reforms, designed to help clean up big business and police the accountants who keep its books. The act was drafted by Senator Paul Sarbanes (D-Maryland) and Representative Michael Oxley (R-Ohio) in the wake of the Enron and WorldCom accounting scandals.
Congress ordered the SEC to set up the accounting board by the end of October, and has set an activation deadline of April 2003 to be up and running. The SEC says more than 450 people have applied or been nominated to the accounting board.
SEC Chief Accountant Robert Herdman said on Friday he hoped the PCAOB would be performing inspections of accounting firms — one of its several tasks — by summer 2003, which would also be well ahead of the schedule ordered by Sarbanes-Oxley.