Problem:
Do you feel that it is naive to believe that all CPAs can maintain independence in both appearance and fact? Over time, CPAs will develop relationships with their clients and certainly the CPAs are dependent on the fees derived from the clients. In 2002, Sarbanes-Oxley made the audit committee directly responsible for the hiring of the audit firm. The SEC and the stock exchanges have issued recent rules and requirements for audit committees to improve independence and financial reporting. What do you feel the audit committee's role is in maintaining independence? Do you feel this role is effective?