Final answer:
The U.S. Supreme Court found that the way the PCAOB was created violates the separation of powers doctrine and it could no longer continue to function.
Step-by-step explanation:
In its decision in the case Free Enterprise Fund and Beckstead and Watts v. Public Company Accounting Oversight Board, the U.S. Supreme Court found that the way that the PCAOB was created violates the separation of powers doctrine, and it could no longer continue to function.
The U.S. Supreme Court found that the PCAOB's structure violated the separation of powers doctrine, particularly in terms of how board members were removed, but allowed the PCAOB to continue operating with amendments to ensure greater executive branch control.
In its decision in the case Free Enterprise Fund and Beckstead and Watts v. Public Company Accounting Oversight Board, the U.S. Supreme Court found that the way that the PCAOB was created violates the separation of powers doctrine, but it did not rule that the PCAOB could no longer continue to function entirely. Instead, the Court invalidated a certain part of the Sarbanes-Oxley Act that related to how PCAOB members were removed, finding it inconsistent with the Constitution's separation of powers. The decision allowed the PCAOB to continue operating but required that its board members be subject to removal by the Securities and Exchange Commission (SEC), at will, thereby providing greater executive control and aligning with constitutional requirements. This highlights the importance of checks and balances and the need for accountability in government regulatory bodies.