Stadler of Duquesne University, "The results of our national poll indicate that average American investors, in fact, overwhelmingly support the need for some new rulemaking in this area. One of the valid complaints of the low-carbohydrate community is that in randomized trials, non-calorie-restricted low-carbohydrate diets are often compared with calorie-restricted low-fat diets.
He challenged research subjects to connect all nine dots using just four straight lines without lifting their pencils from the page.
Only 20 percent managed to break out of the illusory confinement and continue their lines in the white space surrounding the dots. Our Two-Pronged Approach Responds to Various Aspects of Auditor Independence As discussed above, some non-audit services, by their very nature, raise independence concerns because, for example, they place the auditor in the position of auditing his or her own work.
Indeed, the concept enjoyed such strong popularity and intuitive appeal that no one bothered to check the facts. Speakers, trainers, training program developers, organizational consultants, and university professors all had much to say about the vast benefits of outside-the-box thinking.
Meyer, a Governor of the Federal Reserve Board, said in support of our proposed restriction on internal audit outsourcing, "auditor independence is more valuable than these asserted efficiencies. We believe that the two-pronged approach we are taking in the final rules -- requiring disclosure of the fees billed by the auditor for the audit, financial information systems design and implementation services, and other non-audit services, and identifying particular services that are incompatible with independence -- best protects the audit process.
We are otherwise concerned about non-audit services because of the overall economic incentives they create and because of the interdependence that develops between the auditor and the audit client in the course of the non-audit relationship.
Investor uneasiness and suspicion of the quality of audited financial statements is growing rapidly along with the dramatic rise in the percentage of audit firm revenues that come from cross-sold services.
The General Counsel of Andersen Consulting said, "[I]n our experience there is no meaningful crossover of personnel between the audit divisions and these other business consulting functions. An auditor who has appraised an important client asset at mid-year is less likely to question his or her own work at year-end.
The Final Rules Will Not Diminish Audit Quality Some commenters expressed concern that the proposed restrictions on non-audit services would hurt audit quality. It has become much more difficult, and less worthwhile, for private plaintiffs to assert civil claims against auditors even in cases where the plaintiffs believe that an audit failure flowed from a lack of auditor independence.
It was an appealing and apparently convincing message. Investors are more likely to invest, and pricing is more likely to be efficient, the greater the assurance that the financial information disclosed by issuers is reliable. Simply because Congress chose to tolerate an unavoidable degree of conflict inherent in the relationship between a private auditor and a paying client, it hardly follows that all conflicts of interest beyond the unavoidable minimum were approved by Congress or that the statutes express indifference to conflicts of interest.
If investors were to view the auditor as an advocate for the corporate client, the value of the audit function itself might well be lost. The Growth of Certain Non-Audit Services Jeopardizes Independence A common theme running through the reports described above is concern that future expansion of non-audit services may make regulatory action necessary.
And auditor independence, in turn, can be threatened in numerous ways, only one of which is the provision of non-audit services. We recognize that not all non-audit services pose the same risk to independence. Many who provided those perspectives nonetheless urged that we proceed with our rule.
We do not believe that the lack of non-audit services resulted in inadequate audits of the financial statements of seventy-five percent of all public companies.
Hawke, in testimony supporting our proposal to restrict internal audit outsourcing. In response to public comments, 24 in several instances we have conformed the restrictions to the formulations set forth in the professional literature or otherwise modified the final rule to better describe, and in some cases narrow, the types of services restricted.
This risk of liability is attributable to a variety of factors, only one of which is the risk of audit failure. In addition, there are more dual-career families, and audit clients are increasingly hiring firm partners, professional staff, and their spouses for high level management positions.
We note that the rules we adopt today are significantly less restrictive than the proposed rules. At the hearings, we heard from almost witnesses, representing investors, investment professionals, large and small public companies, the Big Five accounting firms, smaller accounting firms, the AICPA, banking regulators, consumer advocates, state accounting board officials, members of the Independence Standards Board "ISB"academics, and others.
Investor confidence in the securities markets arises from a multiplicity of sources. Some commenters agreed with our proposals. They have expanded into international networks, affiliating and marketing under a common name.
No one, that is, before two different research teams —Clarke Burnham with Kenneth Davis, and Joseph Alba with Robert Weisberg—ran another experiment using the same puzzle but a different research procedure. In addition to soliciting comments in the Proposing Release, we held four days of public hearings, including one day in New York City, so that we could engage in a public dialogue with interested parties.
Nonetheless, the study noted, "[m]ost [interviewees] felt that the risks of unfavorable perceptions of auditor independence are growing, due largely to the provision of non-audit services to auditees.The Hollywood Reporter is your source for breaking news about Hollywood and entertainment, including movies, TV, reviews and industry blogs.
Download-Theses Mercredi 10 juin This article is a reply by the author to a response to his article about "The Quality Time Program".
Many of the responses saw the program, which involved teachers 'buddying' with students experiencing behavioural problems, as yet another imposition on. Final Rule: Revision of the Commission's Auditor Independence Requirements SECURITIES AND EXCHANGE COMMISSION 17 CFR Parts and [Release Nos.
; ; ; IC; IA; FR. If it is uninteresting, people will lose weight. Book idea: the Tastes Like Cardboard Diet [TM]. I lost 30 pounds in a couple of months on a high sugar diet.
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