The Supreme Court has finalized its decision affirming the authority of the Securities and Exchange Commission (SEC) to accredit external auditors (Certified Public Accountants) for covered corporations, such as those with secondary licenses or registered securities.
In a resolution released on October 14, the en banc of the Supreme Court denied the motion for reconsideration filed by 1Accountants Party-List, Inc., citing a lack of substantial arguments to reverse the original decision in favor of the SEC.
The Court also issued an order stating that no further pleadings or motions would be entertained, and the entry of judgment would be issued immediately.
The case arose when 1Accountants Party-List questioned the constitutionality of the SEC’s policies on accrediting external auditors, arguing that such authority exceeded the SEC’s mandate since the Board of Accountancy (BOA) holds jurisdiction over CPAs.
In its initial 2022 decision and the 2023 resolution, the Supreme Court ruled in favor of 1Accountants Party-List, declaring the SEC regulations invalid and unconstitutional.
Following an appeal by the SEC, the Supreme Court in January 2025 reversed its prior ruling, declaring the SEC regulations valid and constitutional. According to the Court, the SEC has the right to supervise the auditors of corporations under the agency’s jurisdiction.
For Chairperson Lim, this decision is crucial for maintaining the integrity of overall business governance in the country. (PR)
