September 1999


The expansion of international CPA firms into the practice of law in Europe and Asia presents an acute problem for American regulators of accounting standards. How do we recognize an independent auditor when he holds himself out as an advocate for his client by performing legal services? The roles are completely unreconcilable! The fact is that the auditors of publicly held American companies with legal operations abroad are deficient in their filings with the SEC for the simple reason that they are not independent!

The accounting profession should divide itself into two categories. The first, would be made up of the above reproach, truly independent auditor, who does nothing but review the fairness of the financial condition and operating results as displayed in financial statements of companies. The second group would be comprised of firms that engage in the management advocacy areas of accounting, such as consulting, tax planning and representation, financial services, computer consulting, and the many other quasi-adversarial services where independence is not an issue. How much simpler this would be for the public to understand and deal with!

Ernest R. Field

Field and Field, PC

Great Neck, N.Y.

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