{"identifier":"/us/usc/t15/s7201","title":15,"num":"\u00a7\u202f7201.","heading":"Definitions","text":"\u00a7\u202f7201.\nDefinitions\nExcept as otherwise specifically provided in this Act, in this Act, the following definitions shall apply:\n(1)\nAppropriate State regulatory authority\nThe term \u201cappropriate State regulatory authority\u201d means the State agency or other authority responsible for the licensure or other regulation of the practice of accounting in the State or States having jurisdiction over a registered public accounting firm or associated person thereof, with respect to the matter in question.\n(2)\nAudit\nThe term \u201caudit\u201d means an examination of the financial statements of any issuer by an independent public accounting firm in accordance with the rules of the Board or the Commission (or, for the period preceding the adoption of applicable rules of the Board under\nsection 7213 of this title\n(3)\nAudit committee\nThe term \u201caudit committee\u201d means\u2014\n(A) a committee (or equivalent body) established by and amongst the board of directors of an issuer for the purpose of overseeing the accounting and financial reporting processes of the issuer and audits of the financial statements of the issuer; and\n(B) if no such committee exists with respect to an issuer, the entire board of directors of the issuer.\n(4)\nAudit report\nThe term \u201caudit report\u201d means a document or other record\u2014\n(A) prepared following an audit performed for purposes of compliance by an issuer with the requirements of the securities laws; and\n(B) in which a public accounting firm either\u2014\n(i) sets forth the opinion of that firm regarding a financial statement, report, or other document; or\n(ii) asserts that no such opinion can be expressed.\n(5)\nBoard\nThe term \u201cBoard\u201d means the Public Company Accounting Oversight Board established under\nsection 7211 of this title\n(6)\nCommission\nThe term \u201cCommission\u201d means the Securities and Exchange Commission.\n(7)\nIssuer\nThe term \u201cissuer\u201d means an issuer (as defined in\nsection 78c of this title\nl\no\n15 U.S.C. 77a\n(8)\nNon-audit services\nThe term \u201cnon-audit services\u201d means any professional services provided to an issuer by a registered public accounting firm, other than those provided to an issuer in connection with an audit or a review of the financial statements of an issuer.\n(9)\nPerson associated with a public accounting firm\n(A)\nIn general\nThe terms \u201cperson associated with a public accounting firm\u201d (or with a \u201cregistered public accounting firm\u201d) and \u201cassociated person of a public accounting firm\u201d (or of a \u201cregistered public accounting firm\u201d) mean any individual proprietor, partner, shareholder, principal, accountant, or other professional employee of a public accounting firm, or any other independent contractor or entity that, in connection with the preparation or issuance of any audit report\u2014\n(i) shares in the profits of, or receives compensation in any other form from, that firm; or\n(ii) participates as agent or otherwise on behalf of such accounting firm in any activity of that firm.\n(B)\nExemption authority\nThe Board may, by rule, exempt persons engaged only in ministerial tasks from the definition in subparagraph (A), to the extent that the Board determines that any such exemption is consistent with the purposes of this Act, the public interest, or the protection of investors.\n(C)\nInvestigative and enforcement authority\nFor purposes of sections 7202(c), 7211(c), 7215, and 7217(c) of this title and the rules of the Board and Commission issued thereunder, except to the extent specifically excepted by such rules, the terms defined in subparagraph (A) shall include any person associated, seeking to become associated, or formerly associated with a public accounting firm, except that\u2014\n(i) the authority to conduct an investigation of such person under\nsection 7215(b) of this title\n(ii) the authority to commence a disciplinary proceeding under\n(I) conduct occurring while such person was associated or seeking to become associated with a registered public accounting firm; or\n(II) non-cooperation, as described in\nsection 7215(b)(3) of this title\n(10)\nProfessional standards\nThe term \u201cprofessional standards\u201d means\u2014\n(A) accounting principles that are\u2014\n(i) established by the standard setting body described in section 19(b) of the Securities Act of 1933 [\n15 U.S.C. 77s(b)\n15 U.S.C. 77s(a)\nsection 78m(b) of this title\n(ii) relevant to audit reports for particular issuers, or dealt with in the quality control system of a particular registered public accounting firm; and\n(B) auditing standards, standards for attestation engagements, quality control policies and procedures, ethical and competency standards, and independence standards (including rules implementing title II) that the Board or the Commission determines\u2014\n(i) relate to the preparation or issuance of audit reports for issuers; and\n(ii) are established or adopted by the Board under\nsection 7213(a) of this title\n(11)\nPublic accounting firm\nThe term \u201cpublic accounting firm\u201d means\u2014\n(A) a proprietorship, partnership, incorporated association, corporation, limited liability company, limited liability partnership, or other legal entity that is engaged in the practice of public accounting or preparing or issuing audit reports; and\n(B) to the extent so designated by the rules of the Board, any associated person of any entity described in subparagraph (A).\n(12)\nRegistered public accounting firm\nThe term \u201cregistered public accounting firm\u201d means a public accounting firm registered with the Board in accordance with this Act.\n(13)\nRules of the Board\nThe term \u201crules of the Board\u201d means the bylaws and rules of the Board (as submitted to, and approved, modified, or amended by the Commission, in accordance with\nsection 7217 of this title\n(14)\nSecurity\nThe term \u201csecurity\u201d has the same meaning as in\nsection 78c(a) of this title\n(15)\nSecurities laws\nThe term \u201csecurities laws\u201d means the provisions of law referred to in\nsection 78c(a)(47) of this title\n(16)\nState\nThe term \u201cState\u201d means any State of the United States, the District of Columbia, Puerto Rico, the Virgin Islands, or any other territory or possession of the United States.\n(17)\nForeign auditor oversight authority\nThe term \u201cforeign auditor oversight authority\u201d means any governmental body or other entity empowered by a foreign government to conduct inspections of public accounting firms or otherwise to administer or enforce laws related to the regulation of public accounting firms.","url":"https://projectusc.org/usc/t15/s7201.html","content":[{"t":"sec","id":"/us/usc/t15/s7201","children":[{"t":"num","text":"\u00a7\u202f7201."},{"t":"heading","text":"Definitions","tail":"\n"},{"t":"chapeau","text":"Except as otherwise specifically provided in this Act, in this Act, the following definitions shall apply:"},{"t":"para","id":"/us/usc/t15/s7201/1","children":[{"t":"num","text":"(1)"},{"t":"heading","text":"Appropriate State regulatory authority"},{"t":"content","children":[{"t":"p","text":"The term \u201cappropriate State regulatory authority\u201d means the State agency or other authority responsible for the licensure or other regulation of the practice of accounting in the State or States having jurisdiction over a registered public accounting firm or associated person thereof, with respect to the matter in question.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/2","children":[{"t":"num","text":"(2)"},{"t":"heading","text":"Audit"},{"t":"content","children":[{"t":"p","text":"The term \u201caudit\u201d means an examination of the financial statements of any issuer by an independent public accounting firm in accordance with the rules of the Board or the Commission (or, for the period preceding the adoption of applicable rules of the Board under ","children":[{"t":"ref","text":"section 7213 of this title","href":"/us/usc/t15/s7213","tail":", in accordance with then-applicable generally accepted auditing and related standards for such purposes), for the purpose of expressing an opinion on such statements."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/3","children":[{"t":"num","text":"(3)"},{"t":"heading","text":"Audit committee"},{"t":"chapeau","text":"The term \u201caudit committee\u201d means\u2014"},{"t":"subpara","id":"/us/usc/t15/s7201/3/A","children":[{"t":"num","text":"(A)"},{"t":"content","text":" a committee (or equivalent body) established by and amongst the board of directors of an issuer for the purpose of overseeing the accounting and financial reporting processes of the issuer and audits of the financial statements of the issuer; and","tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t15/s7201/3/B","children":[{"t":"num","text":"(B)"},{"t":"content","text":" if no such committee exists with respect to an issuer, the entire board of directors of the issuer.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/4","children":[{"t":"num","text":"(4)"},{"t":"heading","text":"Audit report"},{"t":"chapeau","text":"The term \u201caudit report\u201d means a document or other record\u2014"},{"t":"subpara","id":"/us/usc/t15/s7201/4/A","children":[{"t":"num","text":"(A)"},{"t":"content","text":" prepared following an audit performed for purposes of compliance by an issuer with the requirements of the securities laws; and","tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t15/s7201/4/B","children":[{"t":"num","text":"(B)"},{"t":"chapeau","text":" in which a public accounting firm either\u2014"},{"t":"clause","id":"/us/usc/t15/s7201/4/B/i","children":[{"t":"num","text":"(i)"},{"t":"content","text":" sets forth the opinion of that firm regarding a financial statement, report, or other document; or","tail":"\n"}],"tail":"\n"},{"t":"clause","id":"/us/usc/t15/s7201/4/B/ii","children":[{"t":"num","text":"(ii)"},{"t":"content","text":" asserts that no such opinion can be expressed.","tail":"\n"}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/5","children":[{"t":"num","text":"(5)"},{"t":"heading","text":"Board"},{"t":"content","children":[{"t":"p","text":"The term \u201cBoard\u201d means the Public Company Accounting Oversight Board established under ","children":[{"t":"ref","text":"section 7211 of this title","href":"/us/usc/t15/s7211","tail":"."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/6","children":[{"t":"num","text":"(6)"},{"t":"heading","text":"Commission"},{"t":"content","children":[{"t":"p","text":"The term \u201cCommission\u201d means the Securities and Exchange Commission.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/7","children":[{"t":"num","text":"(7)"},{"t":"heading","text":"Issuer"},{"t":"content","children":[{"t":"p","text":"The term \u201cissuer\u201d means an issuer (as defined in ","children":[{"t":"ref","text":"section 78c of this title","href":"/us/usc/t15/s78c","tail":"), the securities of which are registered under section 78"},{"t":"text","text":"l","tail":" of this title, or that is required to file reports under section 78"},{"t":"text","text":"o","tail":"(d) of this title, or that files or has filed a registration statement that has not yet become effective under the Securities Act of 1933 ("},{"t":"ref","text":"15 U.S.C. 77a","href":"/us/usc/t15/s77a","tail":" et seq.), and that it has not withdrawn."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/8","children":[{"t":"num","text":"(8)"},{"t":"heading","text":"Non-audit services"},{"t":"content","children":[{"t":"p","text":"The term \u201cnon-audit services\u201d means any professional services provided to an issuer by a registered public accounting firm, other than those provided to an issuer in connection with an audit or a review of the financial statements of an issuer.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/9","children":[{"t":"num","text":"(9)"},{"t":"heading","text":"Person associated with a public accounting firm"},{"t":"subpara","id":"/us/usc/t15/s7201/9/A","children":[{"t":"num","text":"(A)"},{"t":"heading","text":"In general"},{"t":"chapeau","text":"The terms \u201cperson associated with a public accounting firm\u201d (or with a \u201cregistered public accounting firm\u201d) and \u201cassociated person of a public accounting firm\u201d (or of a \u201cregistered public accounting firm\u201d) mean any individual proprietor, partner, shareholder, principal, accountant, or other professional employee of a public accounting firm, or any other independent contractor or entity that, in connection with the preparation or issuance of any audit report\u2014"},{"t":"clause","id":"/us/usc/t15/s7201/9/A/i","children":[{"t":"num","text":"(i)"},{"t":"content","text":" shares in the profits of, or receives compensation in any other form from, that firm; or","tail":"\n"}],"tail":"\n"},{"t":"clause","id":"/us/usc/t15/s7201/9/A/ii","children":[{"t":"num","text":"(ii)"},{"t":"content","text":" participates as agent or otherwise on behalf of such accounting firm in any activity of that firm.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t15/s7201/9/B","children":[{"t":"num","text":"(B)"},{"t":"heading","text":"Exemption authority"},{"t":"content","children":[{"t":"p","text":"The Board may, by rule, exempt persons engaged only in ministerial tasks from the definition in subparagraph (A), to the extent that the Board determines that any such exemption is consistent with the purposes of this Act, the public interest, or the protection of investors.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t15/s7201/9/C","children":[{"t":"num","text":"(C)"},{"t":"heading","text":"Investigative and enforcement authority"},{"t":"chapeau","text":"For purposes of sections 7202(c), 7211(c), 7215, and 7217(c) of this title and the rules of the Board and Commission issued thereunder, except to the extent specifically excepted by such rules, the terms defined in subparagraph (A) shall include any person associated, seeking to become associated, or formerly associated with a public accounting firm, except that\u2014"},{"t":"clause","id":"/us/usc/t15/s7201/9/C/i","children":[{"t":"num","text":"(i)"},{"t":"content","text":" the authority to conduct an investigation of such person under ","children":[{"t":"ref","text":"section 7215(b) of this title","href":"/us/usc/t15/s7215/b","tail":" shall apply only with respect to any act or practice, or omission to act, by the person while such person was associated or seeking to become associated with a registered public accounting firm; and"}],"tail":"\n"}],"tail":"\n"},{"t":"clause","id":"/us/usc/t15/s7201/9/C/ii","children":[{"t":"num","text":"(ii)"},{"t":"chapeau","text":" the authority to commence a disciplinary proceeding under ","children":[{"t":"ref","text":"section 7215(c)(1) of this title","href":"/us/usc/t15/s7215/c/1","tail":", or impose sanctions under "},{"t":"ref","text":"section 7215(c)(4) of this title","href":"/us/usc/t15/s7215/c/4","tail":", against such person shall apply only with respect to\u2014"}]},{"t":"subclause","id":"/us/usc/t15/s7201/9/C/ii/I","children":[{"t":"num","text":"(I)"},{"t":"content","text":" conduct occurring while such person was associated or seeking to become associated with a registered public accounting firm; or","tail":"\n"}],"tail":"\n"},{"t":"subclause","id":"/us/usc/t15/s7201/9/C/ii/II","children":[{"t":"num","text":"(II)"},{"t":"content","text":" non-cooperation, as described in ","children":[{"t":"ref","text":"section 7215(b)(3) of this title","href":"/us/usc/t15/s7215/b/3","tail":", with respect to a demand in a Board investigation for testimony, documents, or other information relating to a period when such person was associated or seeking to become associated with a registered public accounting firm."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/10","children":[{"t":"num","text":"(10)"},{"t":"heading","text":"Professional standards"},{"t":"chapeau","text":"The term \u201cprofessional standards\u201d means\u2014"},{"t":"subpara","id":"/us/usc/t15/s7201/10/A","children":[{"t":"num","text":"(A)"},{"t":"chapeau","text":" accounting principles that are\u2014"},{"t":"clause","id":"/us/usc/t15/s7201/10/A/i","children":[{"t":"num","text":"(i)"},{"t":"content","text":" established by the standard setting body described in section 19(b) of the Securities Act of 1933 [","children":[{"t":"ref","text":"15 U.S.C. 77s(b)","href":"/us/usc/t15/s77s/b","tail":"], or prescribed by the Commission under section 19(a) of that Act ["},{"t":"ref","text":"15 U.S.C. 77s(a)","href":"/us/usc/t15/s77s/a","tail":"] or "},{"t":"ref","text":"section 78m(b) of this title","href":"/us/usc/t15/s78m/b","tail":"; and"}],"tail":"\n"}],"tail":"\n"},{"t":"clause","id":"/us/usc/t15/s7201/10/A/ii","children":[{"t":"num","text":"(ii)"},{"t":"content","text":" relevant to audit reports for particular issuers, or dealt with in the quality control system of a particular registered public accounting firm; and","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t15/s7201/10/B","children":[{"t":"num","text":"(B)"},{"t":"chapeau","text":" auditing standards, standards for attestation engagements, quality control policies and procedures, ethical and competency standards, and independence standards (including rules implementing title II) that the Board or the Commission determines\u2014"},{"t":"clause","id":"/us/usc/t15/s7201/10/B/i","children":[{"t":"num","text":"(i)"},{"t":"content","text":" relate to the preparation or issuance of audit reports for issuers; and","tail":"\n"}],"tail":"\n"},{"t":"clause","id":"/us/usc/t15/s7201/10/B/ii","children":[{"t":"num","text":"(ii)"},{"t":"content","text":" are established or adopted by the Board under ","children":[{"t":"ref","text":"section 7213(a) of this title","href":"/us/usc/t15/s7213/a","tail":", or are promulgated as rules of the Commission."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/11","children":[{"t":"num","text":"(11)"},{"t":"heading","text":"Public accounting firm"},{"t":"chapeau","text":"The term \u201cpublic accounting firm\u201d means\u2014"},{"t":"subpara","id":"/us/usc/t15/s7201/11/A","children":[{"t":"num","text":"(A)"},{"t":"content","text":" a proprietorship, partnership, incorporated association, corporation, limited liability company, limited liability partnership, or other legal entity that is engaged in the practice of public accounting or preparing or issuing audit reports; and","tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t15/s7201/11/B","children":[{"t":"num","text":"(B)"},{"t":"content","text":" to the extent so designated by the rules of the Board, any associated person of any entity described in subparagraph (A).","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/12","children":[{"t":"num","text":"(12)"},{"t":"heading","text":"Registered public accounting firm"},{"t":"content","children":[{"t":"p","text":"The term \u201cregistered public accounting firm\u201d means a public accounting firm registered with the Board in accordance with this Act.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/13","children":[{"t":"num","text":"(13)"},{"t":"heading","text":"Rules of the Board"},{"t":"content","children":[{"t":"p","text":"The term \u201crules of the Board\u201d means the bylaws and rules of the Board (as submitted to, and approved, modified, or amended by the Commission, in accordance with ","children":[{"t":"ref","text":"section 7217 of this title","href":"/us/usc/t15/s7217","tail":"), and those stated policies, practices, and interpretations of the Board that the Commission, by rule, may deem to be rules of the Board, as necessary or appropriate in the public interest or for the protection of investors."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/14","children":[{"t":"num","text":"(14)"},{"t":"heading","text":"Security"},{"t":"content","children":[{"t":"p","text":"The term \u201csecurity\u201d has the same meaning as in ","children":[{"t":"ref","text":"section 78c(a) of this title","href":"/us/usc/t15/s78c/a","tail":"."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/15","children":[{"t":"num","text":"(15)"},{"t":"heading","text":"Securities laws"},{"t":"content","children":[{"t":"p","text":"The term \u201csecurities laws\u201d means the provisions of law referred to in ","children":[{"t":"ref","text":"section 78c(a)(47) of this title","href":"/us/usc/t15/s78c/a/47","tail":" and includes the rules, regulations, and orders issued by the Commission thereunder."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/16","children":[{"t":"num","text":"(16)"},{"t":"heading","text":"State"},{"t":"content","children":[{"t":"p","text":"The term \u201cState\u201d means any State of the United States, the District of Columbia, Puerto Rico, the Virgin Islands, or any other territory or possession of the United States.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t15/s7201/17","children":[{"t":"num","text":"(17)"},{"t":"heading","text":"Foreign auditor oversight authority"},{"t":"content","children":[{"t":"p","text":"The term \u201cforeign auditor oversight authority\u201d means any governmental body or other entity empowered by a foreign government to conduct inspections of public accounting firms or otherwise to administer or enforce laws related to the regulation of public accounting firms.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"text","text":"\n"},{"t":"text","text":"\n"}]}]}