New York (May 9, 2002) -- Anticipating a shuffling of auditors among public companies in the wake of the Andersen/Enron scandal, the SEC Practice Section of the American Institute of CPAs Wednesday issued special guidance directed at U.S. audit firms taking on increased numbers of new publicly traded clients and/or professional staff.
“In the wake of Enron, many SEC registrants have changed auditors,” said Robert J. Kueppers, Chair of the SEC Practice Section. “The resulting influx of new clients and personnel in a short period of time may require a given firm to pay special attention to its quality control systems. We encourage firms to use this guidance to review their systems.”
The guidance draws from existing AICPA professional standards and covers the elements of a firm’s quality control system that could be affected by the addition of new clients or personnel including: independence; personnel management, including audit partner rotation and concurring partner review; acceptance and continuance of clients and engagements; engagement performance, including the completion of audits in progress, re-audits, quarterly reviews, issuance of comfort letters and discovery of possible misstatements in financial statements reported on by a previous auditor; and quality-control monitoring
The practice aid, Assessing the Effect on a Firm’s System of Quality Control Due to a Significant Increase in New Clients and/or Experienced Personnel, is available on the AICPA’s website at http://www.aicpa.org.
-- Electronic Accountant Newswire staff
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