The accountants care, that's all that matters. Screw the rest of you guys, we're on it...

Only in Bizarro World would the PCAOB be on the chopping block and the Fed given additional authority. Oh well. Bizarro World it is.

Via Accountancy Age:

America’s accounting watchdog, the Public Company Accounting Oversight Board (PCAOB), could be altered or even scrapped after the US Supreme Court agreed to consider a lawsuit challenging the constitutionality of the 2002 law that created it.

As the highest judicial authority in the country, the Supreme Court’s announcement on 18 May that it would hear a case this autumn brought against the Sarbanes-Oxley Act of 2002 has caused a major stir.

Congress, of course, passed the law in response to the accounting scandals surrounding firms such as Enron, WorldCom and Arthur Andersen. The law created the PCAOB to act as a regulator of auditors of public companies to protect against manipulative accounting practices.

The legal case centres on a provision giving the US Securities and Exchange Commission (SEC) the authority to appoint the PCAOB’s five-member board.

The SEC was given that responsibility in part to establish a degree of political independence in the selection of board members, but plaintiffs in the case argue that it runs foul of the president’s power under the US constitution to appoint all ‘officers of the United States’ federal government’.

The plaintiffs include an accounting firm, Beckstead & Watts, the Competitive Enterprise Institute and the Free Enterprise Fund, groups that promote limited government regulation and intervention into the markets.

Critics of Sarbanes-Oxley have long chafed at its strict auditing requirements and high compliance costs, complaining that it was an overreaction by Congress to the accounting scandals.

The Supreme Court could decide to invalidate the law ­ and with it the PCAOB, in which case Congress would be forced to make revisions. A lower federal appeals court in Washington upheld the law in August 2008.

In a possible sign of the uncertainty surrounding the PCAOB, the board’s chairman, Mark W Olson, announced shortly after the Supreme Court’s decision to hear the case, that he would resign his post at the end of July ­ more than a year before his term expired. Olson said his decision was ‘entirely personal and reflects my desire at this time of life to establish new priorities.’