SC Affirms SEC Authority to Accredit External Auditors

The Securities and Exchange Commission (SEC) has secured a favorable decision from the Supreme Court (SC) on its authority to accredit external auditors of covered entities, including publicly listed companies and investment firms.

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In an 18-page resolution promulgated on Jan. 28, the High Tribunal affirmed SEC's authority to accredit certified public accountants acting as external auditors of corporations issuing registered securities and owning secondary licenses.

The SC's resolution in favor of the SEC declared as valid and constitutional Rule 68, Paragraph 3 of the implementing rules and regulations of the Securities Regulation Code as well as the Revised Guidelines on Accreditation of Auditing Firms and External Auditors, reversing earlier findings of invalidity and unconstitutionality of the subject regulations.

The regulations set accreditation guidelines and requirements for external auditors of covered entities, including publicly listed companies, investment firms as well as lending and financing companies, among others.