The SEC is asking the PCAOB again to create a formal process for inspecting broker-dealer auditors. Reuters reports that for more than ten years, this area has depended on an interim system. At the SEC Speaks 2026 conference, SEC Chief Accountant Kurt Hohl said the agency has asked the PCAOB to “finalize their broker-dealer inspection program, so it’s no longer an interim but a finalized program.”  

The Dodd-Frank Act of 2010 gave the PCAOB authority to oversee these audits. Since 2011, it has used a temporary inspection program. Progress toward a permanent system has been slow, partly due to questions about the program’s scope, inspection frequency, and possible exemptions.  

The inspection program was started to address problems exposed by the Bernard Madoff scandal, where audit failures let fraud go undetected. There are still questions about how a permanent program should address differences among broker-dealers, especially since smaller firms say compliance costs might be too high for them.  

In the past, some legislative proposals aimed to exempt certain smaller broker-dealers from PACOB audit rules, but these proposals did not advance. Unless the law changes, the board still has the authority to decide how the program operates, including whether to treat different types of firms differently.  

PCAOB officials say the interim program is still working well, but the SEC’s renewed push shows there are expectations for a permanent program.