The Dallas Morning News did some digging into the reasons why auditors are dismissed. It found that auditors often risk dismissal when they force a company to restate its earnings. And auditors who determine a company probably won't stay in business have an even better chance of being dismissed.

While law-makers and regulators hammer out the specifics of the new Public Accountability Board proposed by Securities and Exchange Commission (SEC) Chairman Harvey Pitt and endorsed by President Bush, the Big Five firms may catch a break on long-awaited reviews of their auditor independence systems. Under a program started two years ago, the Big Five were directed to modernize their internal independence compliance systems according to a timetable set by the SEC.

Beleaguered Andersen was dealt another blow Wednesday when mortgage giant Freddie Mac dropped the Big Five firm after a 30-year audit relationship. Freddie Mac joins a long and growing list of clients that are abandoning Andersen in the aftermath of the firm's involvement in the Enron collapse.Freddie Mac replaced Andersen with PricewaterhouseCoopers, the firm that so far seems to be reaping the largest benefit from Andersen defectors.

Big Five firm Andersen has agreed to pay $217 million to settle litigation stemming from the bankruptcy of the Baptist Foundation of Arizona.

Differences of opinion between House Democrats and Republicans have resulted in the introduction of a second bill in the House Financial Services Committee. Known as the Comprehensive Investor Protection Act (CIPA), this new proposal is the toughest accounting reform bill yet.

At the first meeting of Arthur Andersen's Independent Oversight Board on February 27, 2002, Chairman Paul Volcker announced the formation of an Advisory Panel and established an agenda of priority issues. Priority IssuesThe priority issues to receive prompt attention include quality control, so-called "revolving door" policies, and the firm's incentive plans.

The U.S. General Accounting Office has released for comment an exposure draft of the 2002 revision of the Government Auditing Standards (GAGAS). This exposure draft excludes the standard for independence which is being revised separately. The proposed audit standards, which are known as the "yellow book," are organized into three sections: financial audits, attestation engagements and performance audits.

In the midst of a growing controversy over tax-audit conflicts, PricewaterhouseCoopers (PwC) sold its federal tax lobbying group to Clark/Bardes, a NASDAQ company that plans to list on the New York Stock Exchange next month. PwC was believed to be the largest tax lobbying firm in the year 2000, when it earned approximately $9.5 million for tax lobbying. The tax lobbying group is led by Ken Kies, former Chief of Staff to the Joint Committee on Taxation of the U.S. Congress. One of Washington's best known and most outspoken tax lobbyists, Mr.

Europe’s highest court recently backed a Dutch ban on bundling auditing with legal services, thereby dampening the hopes of U.S. accounting firms who seek to provide legal services as part of "one-stop shopping" for clients. Separately, the head of the European Commission spoke out against U.S. accounting principles and said he will ask the Securities and Exchange Commission (SEC) to recognize International Accounting Standards (IAS) as an alternative to U.S.