SEC COMMISSIONER GALLAGHER SPEAKS AT OPEN MEETING ON PUBLIC COMPANY ACCOUNTING OVERSIGHT BOARD'S PROPOSED 2012 BUDGET

The following excerpt is from the SEC website:

"Thank you, Chairman Schapiro. I would like to echo the gratitude already expressed by my fellow commissioners to the staffs of the PCAOB and SEC for their hard work, and I would also like to thank Chairman Doty and his fellow board members for being here today.

As has been noted, section 109(b) of the Sarbanes-Oxley Act requires that the PCAOB’s budget be approved by the Securities and Exchange Commission.

It would have been possible to approve the Board’s annual budget and accounting support fee in a non-public process, but I believe it is important that the Commission exercise its approval authority in the uniquely public manner that an open meeting affords us. Indeed, as Chairman Doty recognized, the PCAOB support fees, like many other regulatory fees, are ultimately paid by investors and so this is highly important. I want to thank Chairman Schapiro for finding time on our very busy calendar to hold this meeting.

Congress provided that the Board should be funded primarily through an accounting support fee (Sec. 109(c)(1)). That means the appropriations process by which the Congress oversees the SEC and many other Government departments and agencies does not apply to the Board’s accounting support fee, and so has no potential to constrain the Board’s budget or guide the various activities it funds. The role Congress has assigned to the Commission, then, is essentially to stand in the Congress’s stead in ensuring that the Board raises and spends its funds in the best interest of the investing public and, thereby, that of accounting profession as a whole.

Having reached the end of its review process for the PCAOB’s 2012 budget, the Commission’s staff, represented this morning by the Office of the Chief Accountant, recommends that the Commission approve the Board’s budget – and I am happy to play my part in doing so.

But, consistent with our responsibility, I want to join my colleagues in raising certain questions, which I’ll direct to Jim Kroeker, our Chief Accountant, and Jim Doty, the Board’s Chairman, as appropriate."