The Public Company Accounting Oversight Board (PCAOB) approved its 2021 budget, its five-year strategic plan and a change to align the board's independence rules with those of the Securities and Exchange Commission (SEC). On all three measures, one board member, J. Robert Brown, was the sole dissenting voice.

The proposed budget for the PCAOB is $287.3 million, which would fund 859 positions, as well as processes and technology. It is the Securities and Exchange Commission (SEC), though, that will ultimately need to approve the budget.

Most board members approved of this proposed budget. For instance, Rebekah Goshorn Jurata said that it reflects the fiscal prudence needed of regulators during a time of economic scarcity.

"It's through all of our successful activities to date, that we can do more without significantly expanding our budget," she said in her statement. "I believe the modest increase, of less than one percent, to our 2021 budget appropriately reflects the current economic climate and the Board's commitment to prudent fiscal governance."

Duane M. DesParte added that while the increase is small, it shifts around costs to bring more personnel on board, including audit staff, and, like Juarata, he thought it was an example of the PCAOB being able to do more with less.

"Notably, the 2021 Budget reflects targeted increases in the staffing of our Office of the Chief Auditor function, to appropriately support the ongoing projects to update our standards on Quality Control and Supervision of Audits Involving Other Auditors," said DesParte. "This increase in staffing will also help ensure we continue to advance our Data and Technology and Audit Evidence research projects."

Yet Brown, as the sole 'no' vote, said that there were a number of issues with the budget that prevented him from supporting the measure. For one, he thought that resources devoted to the Office of the Chief Accountant were inadequate to enact a modernization of the PCAOB's auditing and quality control standards, which he said is "probably the most important, effective and efficient mechanism for improving audit quality." He also the resources were inadequate to craft a meaningful standard-setting agenda. He additionally pointed out that staffing for the Division of Registration and Inspections has remained flat for the past two years, and that, even before the pandemic, there weren't enough people to conduct the necessary number of inspections. With the pandemic, inspections have plunged by 14 percent, and he warned that staff will need to play catch-up next year.

Brown also believes that the board's cash reserves are inadequate, saying that the 2021 budget provides about five months' worth. Historically, the PCAOB sends out billing invoices in April and collects most of its assessments in May. This, he noted is an "exceptionally right" time frame. He noted that, this year, the pandemic hit just as the new billing cycle was starting up and it was only through "extraordinary efforts by the staff" that  billing and collection went on as normal.

"The PCAOB may not, however, be so lucky the next time," he said, noting that a black swan or green swan-type event, or any other development that throws off the timeline, could actually result in the PCAOB running out of money.

"The PCAOB has made significant progress in executing our strategic plan and advancing our vision for the organization," said Duhnke “I look forward to working with my fellow Board members and our dedicated staff as we continue to strive for forward-looking, responsive, and innovative oversight."