New PCAOB Rules: Financial Enforcement Hearings Go Public, But Some Decisions Get Quieter

The PCAOB Enforcement Transparency Act of 2025 is shaking up how the Public Company Accounting Oversight Board (PCAOB) handles its business, specifically when it comes to holding people accountable. If the PCAOB sounds like bureaucratic alphabet soup, think of them as the financial police for the accountants who audit publicly traded companies. This bill delivers a mixed bag of transparency: it opens the doors to enforcement hearings but quietly removes a requirement to publish certain final decisions.

The Open-Door Policy for Financial Hearings

Section 2 is the big win for public visibility. It mandates that PCAOB enforcement hearings—where the Board disciplines accounting firms or auditors for misconduct—must now be open to the public by default. Previously, these hearings were often held behind closed doors. Now, the default setting is "public," meaning the Board has to actively issue an order to close the hearing if they want privacy, or if one of the parties involved specifically asks for it to be closed. This is a significant shift. For investors, financial journalists, or anyone trying to follow how the PCAOB enforces the rules, this means much better access to the actual proceedings. It’s like turning on the live stream for the courtroom instead of just reading the verdict later.

The Quiet Removal of Public Determinations

But here’s the tricky part that requires a closer look: Section 3. This provision removes a specific statutory requirement for the PCAOB to publish certain determinations under the Sarbanes-Oxley Act. While the bill doesn't specify which determinations are being removed from the public record, removing a mandatory publication requirement generally means less public information. It’s a classic trade-off: we gain transparency in the process of the hearing (Section 2), but we lose mandatory transparency regarding the outcome or specific findings in certain cases (Section 3). For the busy person trying to track if the financial cops are doing their jobs, this makes it harder to see the full picture of the Board's final actions in those specific instances.

What This Means for Everyday Accountability

This Act creates a dynamic where the PCAOB’s discretion increases. On one hand, the default public hearing rule in Section 2 puts pressure on the Board and the parties involved to conduct proceedings seriously, knowing the public is watching. This could lead to greater accountability and better enforcement outcomes, which ultimately protects investors and the integrity of the market. On the other hand, the Board is given broad power to close hearings if they “decide it should be closed,” and the removal of the publication requirement in Section 3 means they can shield specific final decisions from mandatory public view. If the Board uses this discretion too often—closing hearings frequently or using the removed publication requirement to bury less favorable determinations—the intended transparency gains could be quickly undermined. It’s a bill that gives with one hand (public hearings) and takes away with the other (mandatory published decisions), making the public’s ability to oversee the financial watchdogs a bit more complicated.