New York City (May 13, 2004) -- John O'Connor, vice chairman of services at PricewaterhouseCoopers, gave the three primary reasons why his firm resigns as an auditor -- which he said happened 500 times in 2003.

Speaking at a forum on auditor independence this week at NYU's Stern School of Business, O'Connor said that the top reasons the firm resigns an audit are:

1. A failure of the company to manage risk properly;
2. Lack of profitability for PwC; and,
3. Dissatisfaction with how PwC personnel are being treated.

Also at the forum, the Public Company Accounting Oversight  Board Deputy Chief Auditor Thomas Ray said that additional guidance may be needed to help audit committees review independence implications of nonaudit services. Ray also said that in future standards setting, the PCAOB would focus on independence in appearance, as well as independence in fact.

-- Howard Wolosky

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