SEC's Top Accountant Evaluates Changes to Audit Inspections and Conflict-of-Interest Rules

This analysis is based on the Wall Street Journal article [1] published on December 8, 2025, reporting on remarks by Kurt Hohl, the SEC’s chief accountant since July 2025. With a 26-year career at EY—where he rose to global deputy vice-chair of assurance before retiring in 2023—Hohl brings extensive industry experience to his regulatory role. Speaking at a conference in Washington, D.C., he announced the SEC is evaluating three key areas of audit regulation: auditor-client conflict-of-interest rules, the audit watchdog’s inspection processes for accounting firms, and compliance costs imposed on companies [1]. Hohl also highlighted the need for accounting standard setters to scrutinize the costs of disclosures under new rules, warning that excessive compliance burdens could dissuade companies from accessing public markets [1].

1. Industry Experience as a Regulatory Driver
   : Hohl’s long tenure at a major accounting firm (EY) may inform a balanced regulatory approach, potentially addressing both oversight gaps and the practical compliance challenges faced by companies and auditors [0].
2. Early Strategic Priorities
   : The timing of these remarks—within five months of Hohl’s appointment—identifies audit regulatory reforms as early high-priority initiatives for the SEC’s accounting oversight [0].
3. Public Market Access Focus
   : Hohl’s emphasis on disclosure costs reflects a broader SEC concern about maintaining the attractiveness of public markets amid rising regulatory burdens [0].

• Risks
  : Potential resistance from accounting firms or companies to proposed rule changes, uncertainty in implementation timelines, and the challenge of balancing enhanced oversight with reduced compliance costs [0].
• Opportunities
  : More efficient and targeted audit inspections, lower compliance barriers for companies considering public market access, and strengthened safeguards against auditor-client conflicts of interest [0].

The SEC’s chief accountant has signaled a review of critical audit regulations, focusing on conflict-of-interest rules, inspection processes, and compliance costs. Stakeholders in the accounting industry and public markets should monitor subsequent SEC announcements for detailed proposals, as these potential changes could have broad implications for regulatory oversight and market access [0].