SEC Chairman Wants a Better Plan

Yesterday, in a speech delivered to the New York University School of Law, Securities and Exchange Commission (SEC) Chairman, Arthur Levitt, asked major accounting firms to join him and the SEC in developing a plan to assess the firms’ past compliance with financial investment rules. He also wants to explore ways the process can be improved.

The speech put the events of the PwC auditor independence issues of January, 1999 into context and labeled them minor and inadvertent; however, he believes that there is still much to be done to preserve the public’s trust in this area. Currently, as much as 70 percent of larger accounting firms’ revenue comes in the form of consulting fees as opposed to 30 percent for audits.

The Chairman pledged to use the information obtained from the large firms to improve compliance systems in the future and not to punish them for minor, past mistakes. PwC Global’s CEO, James J. Schiro, has already released a statement that has dedicated PwC to this process.

Levitt indicated that a careful balance of “bright lines” rules that clearly demarcate certain services inconsistent with an independent audit, and greater disclosure of other services rendered to audit clients seems warranted and prudent.

Already a member? log in here.

Upcoming CPE Webinars

Sep 24
In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards. A dashboard condenses large amounts of data into a compact space, yet enables the end user to easily drill down into details when warranted.
Sep 30
This webcast will include discussions of important issues in SSARS No. 19 and the current status of proposed changes by the Accounting and Review Services Committee in these statements.
Oct 21
Kristen Rampe will share how to speak and write more effectively by understanding your own and your audience's communication style.
Oct 23
Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.