I’ve finally taken the chance to read sections of the Frank-Dodd Act, rather than journalist’s reports and opinions about the Frank-Dodd Act. (Incidentally, if the Sarbanes-Oxley Act was referred to as SOX, what will the Frank-Dodd act be referred to as? FD, FDA, or perhaps Frodd?) I’ve found a number of interesting tidbits that I thought would be worth highlighting.

First, I hadn’t realized that the Frank-Dodd Act created an Office of Financial Research (OFR) within the Department of the Treasury. Aside from the fact that they are not limited to the typical government pay scale, I was interested to learn that Congress authorized an academic fellowship program as part of the OFR (Sec. 152 (i)). How many other academic fellowships among financial regulators can say they were created by an act of congress?

Second, I found that the GASB now has a support fee assessed against members of the national securities association (Sec. 978). I imagine this will make the GASB feel about as excited as the SOX support fees made the FASB feel–very excited. No longer can constituents threaten to withhold donations or other necessary support when a standard doesn’t suit them.

Third, I discovered that an audit firm that relies on a foreign audit firm’s work to conduct its audit must secure “the agreement of any foreign public accounting firm to [provide its workpapers], as a condition of the reliance by the registered public accounting firm on the work of that foreign public accounting firm” (Sec. 929J). I guess the PCAOB was getting tired of pursuing foreign audit firm workpapers and getting snubbed. This should take care of that little problem.

Fourth, nationally recognized statistical rating organizations (i.e., credit rating agencies) are required by law to include among a rating’s quantitative disclosures that indicate the “5 assumptions made in the ratings process that, without accounting for any other factor, would have the greatest impact on a rating if the assumptions were proven false or inaccurate” (Sec 932). I imagine these disclosures could be pretty useful, if for nothing else than a great discussion on uncertainties in a financial statement analysis class or a finance class.

Last of all (for now), the Financial Stability Oversight Council (Sec. 112) has authority to “monitor domestic and international financial regulatory proposals and developments, including insurance and accounting issues, and to advise Congress and make recommendations in such areas that will enhance the integrity, efficiency, competitiveness, and stability of the US financial markets.” I wonder how the creation of this “advisory” mechanism will influence the already pretty powerful lobbying mechanisms that companies use to defeat unwanted accounting proposals. I guess we’ll have to wait to see.

I must say that I didn’t find this Act nearly as fun to read as the Sarbanes-Oxley Act, but I’m sure there’s just more than I could swallow in one or even fifty readings. But I take comfort in knowing I’m with the majority of congress who probably haven’t had a chance to read it yet either.