It's time for public companies to begin disclosing the reasons behind an auditor change, a new report from Glass Lewis & Co. argues.
The research firm, which works with money managers and other large investors, issued a report last week, "Mum's the Word," which examines auditor-turnover trends. According to the firm, in 2005 more than 1,400 public companies changed their independent accounting firms, including 77 companies that changed auditors at least twice. Nearly three-quarters of the changes were by companies that did not provide a reason for making a switch.
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