Monday Sept 22 2014
PCAOB Set to Rule on Auditor Disclosure
Audit Firms lobby for alternatives
REuglators Accounting Firms Bicker over Audit Rule - this maynow work unless you subscribe
The PCAOB has proposed that the audit partner in charge reveal his or her name in the statement submitted with the annual report. Not surprisingly the audit firms have responded there is no evidence that improves information the audit provides. The audit firms have suggested the partner's name would be better revealed in what is termed Form Two. This is the Audit Firm's report filed with the PCAOB and is on the PCAOB website.
The audit firms also argue that partners move, retire, change positions, etc which just sounds like a smoke screen to me.
Clearly the audit firms want it more difficult to identify this person. i suspect this is generated by fear of lawsuits and harassment by disgruntled investors, which is understandable.
All of which says a lot about out legalistic society today.
Perhaps the most famous signature event in American history was the signing of the Declaration of Independence. John Hancock's signature is prominent as the first signer and is clear to anyone examining the original document. This resulted int the aphorism ' put your John Hancock on it' meaning that if you are the author or creator you should be proud to say so. The techs that created the first Mac computer has their names on the inside of the computer case. Individuals that assemble the engines of exotic sports cars have their name on a tag inside the engine compartment.
And remember that the CEO and CFO of the company have to personally sign off and guarantee the statements. If that requirement is good enough to them why is the auditor unwilling to do the same?
And while we are at it, how about posting the fee for the audit as well?
What do you think?
Professor Elam 
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