September 19, 2020

Duh of the Day: Consulting Work by Audit Firms Could Possibly Impair Audit Integrity

The rise of non-audit services offered by accounting firms could threaten the quality and integrity of independent audits, said Steven Harris, a key member of the government’s watchdog agency.

Although the Securities and Exchange Commission has limits on the kinds of consulting and advisory work audit firms can perform for their clients, that line may be blurring with services such as tax consulting, said Mr. Harris, chair of the investor advisory group of the Public Company Accounting Oversight Board.

“Investors are concerned that the firms may not maintain their public watchdog, total independence and complete fidelity to the public trust responsibilities,” he said Monday at the Practising Law Institute’s 12th Annual Directors’ Institute on Corporate Governance in New York. [CFO Journal]

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