---
kind: "section"
citation: "15 U.S.C. § 7265"
title: "15"
title_heading: "Commerce and Trade"
number: "7265"
heading: "Disclosure of audit committee financial expert"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/15/7265"
units:
  - "Chapter 98 — Public Company Accounting Reform and Corporate Responsibility"
  - "Subchapter IV — Enhanced Financial Disclosures"
---

# §7265. Disclosure of audit committee financial expert

- (a) **Rules defining “financial expert”—** The [Commission](/usc/15/7201.md?p=6) shall issue rules, as necessary or appropriate in the public interest and consistent with the protection of investors, to require each [issuer](/usc/15/7201.md?p=7), together with periodic reports required pursuant to sections [78m(a)](/usc/15/78m.md?p=a) and [78o(d)](/usc/15/78o.md?p=d) of this title, to disclose whether or not, and if not, the reasons therefor, the [audit committee](/usc/15/7201.md?p=3) of that [issuer](/usc/15/7201.md?p=7) is comprised of at least 1 member who is a financial expert, as such term is defined by the [Commission](/usc/15/7201.md?p=6).
- (b) **Considerations—** In defining the term “financial expert” for purposes of [subsection (a)](#a), the [Commission](/usc/15/7201.md?p=6) shall consider whether a [person](/usc/15/7a.md?p=6) has, through education and experience as a public accountant or auditor or a principal financial officer, comptroller, or principal accounting officer of an [issuer](/usc/15/7201.md?p=7), or from a position involving the performance of similar functions—
  - (1) an understanding of generally accepted accounting principles and financial statements;
  - (2) experience in—
    - (A) the preparation or auditing of financial statements of generally comparable [issuers](/usc/15/7201.md?p=7); and
    - (B) the application of such principles in connection with the accounting for estimates, accruals, and reserves;
  - (3) experience with internal accounting controls; and
  - (4) an understanding of [audit committee](/usc/15/7201.md?p=3) functions.
- (c) **Deadline for rulemaking—** The [Commission](/usc/15/7201.md?p=6) shall—
  - (1) propose rules to implement this section, not later than 90 days after July 30, 2002; and
  - (2) issue final rules to implement this section, not later than 180 days after July 30, 2002.

## Source credit

(Pub. L. 107–204, title IV, § 407, July 30, 2002, 116 Stat. 790.)