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U.S. Securities and Exchange Commission

Comments on Proposed Rule:
Auditor Independence Requirements

Release Nos. 33-7870; 34-42994; 35-27193; IC-24549; IA-1884; File No. S7-13-00

Author:  Dawn Badgley  at Internet
Date:    09/10/2000  7:52 PM
Subject: "File No.S7-13-00"
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SEC Chairman Arthur Levitt and the Securities and Exchange Commission re 
File No. S7-13-00:
As an amateur investor and a professional real estate broker, the answer 
to independent auditors does not seem so difficult to me.
Several years ago "undisclosed dual agency" was met by certain people in 
the real estate industry with the same resistance as  CPA's resisting 
"auditor independence".  My personal experience has been that the 
regulation protecting buyers has been good for everyone and, in fact, may 
even have increased sales because people feel less trapped and 
manipulated by a system that works contrary to trust.
I would like to encourage the members of the Commission to require 
accounting and consulting services of companies to be performed by 
separate and independent accounting firms.
I applaud your attention to this matter and praise the courage of those 
such as John Bogle of The Vanguard Group for taking an aggressive public 
stand on this issue.
Thank you for reading my viewpoint.
Dawn Badgley@home.com

Author:  "Kurt W. Baumgartner"  at Internet
Date:    09/10/2000  9:27 AM
Subject: File No. S7-13-00
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Dear sir(s):
I am inclined to agree with Mr. Bogle on the issue of Auditor Independence, 
and side with the SEC to review  Auditor Independence as a high priority.
Keeping audits separate from consulting services can only assist 
shareholders' security and the company's they own.
Kurt W. Baumgartner
"I must be cruel so as to be kind,
so that less bad begins and more remains behind."
             - 'Liam "Bill" Spear-Shaker something or another'


Author:   at Internet
Date:    09/10/2000  12:35 PM
Subject: File Number S7-13-00
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I am not a member of a Big Ten accounting firm. I don't even know anyone 
who is. But I do have a modest amount of money invested, and I would like 
to continue to do so in the future. Understanding the subtle workings and 
shadings of a financial statement is a tiring task for me, and I work hard 
to conquer its meaning. But over time I have gained a reasonable amount of 
understanding with the shifts and movements seen in a company's quarterly 
and annual statements. Without a basic confidence in the accuracy of these 
tools I have available, any investment decision I would be able to make 
would be more like a lottery bet than a financial decision.
For this reason I support the SEC and its current review of audit practices 
and possible conflicts of interests surrounding the companies that perform 
them. I know that the SEC is stepping on some very big financial toes. But 
the SEC is the only group that I can depend on to keep the playing field 
level for me and other individual investors. Without that I'd be forced 
into less attractive investment instruments. In the long run this would not 
be good for the investment community or the United States economy as a 
Marcus Bell

Author:  "Chuck Berry"  at Internet
Date:    09/10/2000  7:22 PM
Subject: File no. S7-13-00
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i am not an expert but it appears to me to be a conflict of interest for an 
auditor to accept fees for auditing a company and for "consulting" - however 
that might be defined.  and while there may be nothing wrong going on, 
appearances, where money is involved, is very important.
Charles E Berry, 13835 Seaview  Anacortes WA 98221-8558  (360)299-0922 

Author:   at Internet
Date:    09/10/2000  11:46 AM
Subject: File No. S7-13-00
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To Whom It May Concern:
I would like to go on record in supporting the "Auditor Independence" 
proposed by the SEC.
When consulting fees are growing faster than auditing fees year over year, I 
think it is time to "lay all the cards on the table," and enforcement by the 
SEC ont his matter will help achieve that end.
Thank you for your attention to this important matter and for your continued 
efforts to try to protect the small investor.  Kudos on the recent ruling to 
end selective disclosure.
Respectfully yours,
Dorrin M. Birch, M.D.
27068 Oakmead Drive
Perrysburg, OH 43551

Author:  annehans  at Internet
Date:    09/10/2000  5:42 PM
Subject: S7-13-00
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Dear SEC:
Please consider the possiblility seriously of making auditors truly 
independent of the companies they audit.  Auditors who also consult for 
the same companies are in a position to abdicate their trust.  We need 
as few of these problems as possible.  We, as stockholders, remember the 
fiasco of the Savings and Loan bailout, and we do not wish to bail out 
auditors or companies who have been questionably audited through the 
declining value of our stock or otherwise.
Thank you,
Anne Bruhner

Author:  yuruo chen  at Internet
Date:    09/10/2000  11:15 PM
Subject: File No. S7-13-00
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I believe the accounting service and consulting 
service should be seperated to prevent conflicts of 
interest. And company should release info to general 
public instead of selected professionals, otherwise it 
is against purpose of release company info to help 
investor evaluate company's stock.

Author:  "John Empsall"  at Internet
Date:    09/10/2000  4:53 PM
Subject: File No. S7=13-00
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Dear Sirs:
As a private investor, I place great reliance on reports that publicly traded 
corporations file with the SEC. These reports are the most important information
a private individual has to evaluate corporations for investment purposes. In 
the past, I felt these reports were reliable because they were reviewed and/or 
prepared by independent outside auditors.
Several recent cases such as the Anderson-Waste Management episode suggest 
auditors for large corporations may not be as independent as previously. Arthur 
Anderson and other top auditors are deriving more revenue from consulting 
services (Anderson Consulting) than from auditing fees from these corporations. 
Until recently, I work for a large corporation which was audited by Arthur 
Anderson, but paid considerably larger fees to Anderson Consulting.
While there has been no proof made public that auditing practices may be 
influence by the more revenue import consulting services, there is an increasing
public perception that this may be the case. There is certainly a conflict of 
interest. I believe a company that is acting as an independent auditor should 
have no other business relationships with the corporation being audited. This is
almost universally followed in small businesses and other types organizations 
that are routinely audited. In large corporations, where much larger financial 
risk are at stake, I believe it is even more important to maintain the complete 
independence of the auditor.
John Empsall
1551 E. Lookout Dr.
Coeur d'Alene, ID 83815
(208) 762-9956

Author:  Ryan Gillespie  at Internet
Date:    09/10/2000  11:40 PM
Subject: File No. S7-13-00
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I will always have to agree with avoiding possibilities of conflicts of 
interest, especially if large amounts of money are involved.  If this is 
the case with auditing/consulting firms, then I feel strongly about 
changes in the SEC that could guarantee auditor independence as John 
Bogle of The Vanguard Group discusses below:
      "Of course there is no clear evidence on this 
      subject, but [the] proposal says very aptly 
      [that] studies cannot always confirm what common 
      sense makes clear.... The stakes are high, and 
      when consulting fees come to be many times more 
      important than audit fees, it just must be 
      obvious to anybody that independence is clearly 
      likely to be impaired. I
      know it's subtle. I know it's a state of mind. But 
      when self-interests predominate, trouble comes
      not far behind. And it seems to me it comes into 
      special focus as a profession becomes a 
      "In this case, the profession of accounting 
      [has] turn[ed] into the business of consulting 
      and cross-selling. It has potentially very 
      adverse consequences to the public interest....
      If you'll forgive me if I add a parallel to my own 
      experience in the mutual fund business, which
      used to be a business of trusteeship and 
      investment management -- and has now
      become a business of marketing, and the public 
      interest, in my judgment, has not been served 
      thereby. So I feel strongly about the divorce of 
      outside services from the audit services." 
      [Emphasis added.]
Thank you,
Ryan Gillespie

Author:  "Rita J. Gillis"  at Internet
Date:    09/10/2000  6:38 PM
Subject: File # S7-13-00
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As an individual investor, I believe it is extremely important that the 
information I read about a companies "audited" versus "unaudited" balance 
sheets be unbiased and "just the facts." If large accounting firms, or small 
ones for that matter, receive a large portion of their fees from consulting 
services from the same companies to which they provide auditing services, it 
would seem these firms would be under a great deal of financial pressure to 
keep the customer's happy. As such, it also would seem that providing the 
stock holders with a less than glowing audit report would NOT be the way to 
keep the customers (public companies) happy. This predicament immediately 
makes the accounting firms not only biased, but perhaps even unethical. If 
an accounting firm can make more money through consulting fees, that firm 
would be inclined to "assist" the customer company in improving that not so 
great looking audit report.
I fully support the investigation into the practice of independent auditors 
who also provide consulting services to the same company they are paid to 
audit. And, I hope there are no illegal or unethical findings, but I 
certainly want to know either way. 

Author:  "Robert Hanseman"  at Internet
Date:    09/10/2000  12:16 PM
Subject: File No. S7-13-00
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Dear Sirs,
As an investor and a taxpayer, I expect the SEC to rigorously police the 
integrity of the auditing system in this 
country.  It defies common sense to expect a business that makes much more money
from "consulting" than from "auditing" to nonetheless place the auditing process
foremost in its collective mind.  The company will also be placed in the 
position of choosing an immediate, identifiable client over the public good (a 
"client" which is widely disbursed and therefore somewhat invisible.
In short, John Bogle is exactly right, and I'd appreciate it if you would heed 
his words.
Robert Hanseman

Author:  "JRatliff-SherWill-IM"  at Internet
Date:    09/10/2000  7:48 PM
Subject: File No, S7-13-00
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I am convinced that a potential conflict of interest exists in situations where 
"independent" audits are performed by firms that also provide consultative 
services to the client they are supposed to be auditing. I support the SEC's 
proposal for "Auditor Independence".

Author:  "Elaine Langer"  at Internet
Date:    09/10/2000  10:11 PM
TO:  at Internet
Subject: File # S7-13-00
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To Whom It May Concern:
I am sending this e-mail to voice my support for the SEC in its desire to 
separate auditing functions from lucrative non-auditing services that 
Independent Auditors provide for their client firms.  It seems self-evident that
it is all too easy for an Independent Auditor to be influenced in a client's 
favor, albeit not intentionally, when other, non-auditing, very lucrative 
services provided to that same client may be affected by the outcome of the 
audit, especially if the latter reveals any problems or discrepancies.  Although
it would be very difficult to obtain "hard" evidence to "prove" this connection,
I believe  it is only logical to suspect that this might be the case more than 
most investors realize.
Elaine Langer
1128 N. 27 St.
Allentown, PA 18104

Author:   at Internet
Date:    09/10/2000  12:20 PM
Subject: File No. S7-13-00
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I believe that CPA firms provide a valuable service to their audit clients 
when providing needed consulting services. The Profession has a set of Rules 
of Conduct that monitors compliance with independence. While these rules are 
not perfect they are a standard that Firms are held accountable to. If the 
rule is passed would a CPA firm be precluded from even providing management 
recommendations in the form of a management letter? Where do you draw the 
line between auditing and consulting? Are you suggesting that CPA firms that 
perform audits become like IRS and look only for mistakes and never make 
suggestions that can help a business do a better job of managing it's 
resources? The few audit failures that occur each year are not enough of a 
reason to change the present system of self-regulation. It is not broke -- do 
not fix it!
George Marthinuss, CPA, CFP  

Author:  "sander b. shipper"  at Internet
Date:    09/10/2000  5:10 PM
Subject: s7-13-00
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sander b. shipper
sbshipper@onebox.com - email
(310) 754-6000 x1102 - voicemail/fax 
Dear S.E.C.;
As a long time investor, I applaud your recent "full disclosure" ruling. 
I am now expressing my support for similar rules concerning Auditors,who 
may also receive compensation for consulting. There must be a system
of check and balance for any regulatory rules to be effective and fair. 
Thank you-SBS    
sander b. shipper
sbshipper@onebox.com - email
(310) 754-6000 x1102 - voicemail/fax
sander b. shipper
sbshipper@onebox.com - email
(310) 754-6000 x1102 - voicemail/fax

Author:  "Shawn Stufflebeam"  at Internet
Date:    09/10/2000  9:49 PM
Subject: File No. S7-13-00
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Dear Sirs:
I trust your judgement. I support your actions on this issue. I am proud 
that the SEC is taking seriously the sacred trust of the citizens of the 
United States. It makes me proud to see a department of our government 
actually protecting the interests of the people.
Don't get me wrong - I LIKE big businesses. But when they will not regulate 
their own actions, they must be regulated. Of the people, by the people, for 
the people.
Thank you for doing your job.
Shawn C. Stufflebeam

Author:  "Patricia Tice"  at Internet
Date:    09/10/2000  8:43 PM
Subject: File No. S7-13-00
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I am deeply concerned about the extent to which auditing firms have become 
consultants to the very firms that have contracted them to certify their 
financial activities.   It is my understanding consulting now accounts for a 
greater percent of the revenues of these large accounting firms than does 
An auditor must act on behalf of the investor, not at the behest of management. 
Auditors must be free to speak and act in support of the truth, independent of 
influence by corporate interests.   Else the stability of our financial markets 
is threatened. 
It is essential that the public be certain of the truth of the numbers in 
corporate audits.  It is up to the SEC to insure that there are rules which 
prevent auditing services from being influenced by the business interests of 
consulting services provided to the same firm.
Yours truly,
Patricia G. Tice
10505 Streamview Court
Potomac, MD 20854

Author:  K & C  at Internet
Date:    09/10/2000  7:01 PM
TO: Kevin Torman  at Internet
Subject: File No. S7-13-00
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I believe that audit information should be released to the shareholder 
at the same time you uncover errors and not be delivered to consulting 
firms who may leverage the price of the stock for their gain.  Also, 
because I lost many dollars when you restricted trade on Gencore for an 
auditing problem from its overseas division, that your should alert the 
stock owners at the same instant all the parties hear the fatal news. It 
would be better to do nothing except alert everyone and let us all 
scramble to sell at once and thereby choose when we want to take the 
loose.  If you agency would allow online 24 hour stock trading, 7 days a 
week this would level out the potential of gain or loss from the 
problems we have with fraudulent practices.
Thank you,
Kennth L. Torman