(The news featured below is a selection from the news covered in the Federal Securities Report Letter, which is distributed to subscribers of the Federal Securities Law Reports.)

PCAOB Submits Registration Rules for SEC Approval

The Public Company Accounting Oversight Board submitted rules defining its registration scheme for audit firms to the SEC for approval. The board's proposed registration system would apply to all public accounting firms, including foreign firms, that prepare or issue audit reports on U.S. public companies. The registration requirement also applies to firms that play a " substantial role" in the preparation or issuance of such reports.

Proposals by the board must be approved by the SEC before becoming effective. If approved by the Commission, all U.S. public accounting firms within the scope of the rules must register with regard to audit reports issued after October 22, 2003. According to the PCAOB, "the registration of non-U.S. firms will raise special issues." Accordingly, the board delayed the registration deadline for foreign firms for 180 days to April 19, 2004.

¨ PCAOB Release No. 2003-007 is reported at ¶86,920 .