David W. Evans
Certified Public Accountant
8572 Manzanita Avenue
California City, CA 93505-5502
(760) 373-1813

August 19, 2000

Jonathan G. Katz, Secretary
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549-0609

Re: S7-13-00

Dear Mr. Katz:

I write this letter to comment upon the SEC's Proposed Rule Governing Auditor Independence. I vehemently oppose this proposal. It is overly broad and its eventual interpretations could adversely affect my practice as a Certified Public Accountant, which includes areas of practice other than audits.

The SEC has moved forward on this rule without facts or evidence. None of the studies or reports cited by the SEC concluded that the scope of services impaired audit effectiveness, or that an exclusionary ban was necessary. The proposed rule appears to be a solution in search of a problem.

The SEC has ignored the conclusion of the Panel on Audit Effectiveness of the Public Oversight Board. The panel concluded that the profession and quality of audits are sound.

Most dangerous for my profession is the likely prospect that the proposed rule would set a precedent for other regulators. Even firms such as mine that do not audit SEC registrants could be impacted by these new rules. The proposed SEC rule would be viewed as the model by state boards of accountancy, as well as federal (e.g., banking and ERISA) and other regulators. These new proposed SEC rules could influence the regulatory approach to auditor independence outside the United States as well.

The SEC claimhs its proposed rule "would not affect tax-related services" to audit clients. I disagree, in part. It would ban acting as an advocate for an audit client, or providing expert services in administrative proceedings, thus potentially prohibiting CPA's from representing clients before the Internal Revenue Service.

The proposed rule would impute to an accounting firm the activities of virtually any entity related to the firm by viewing such an entity as an "affiliate of the accounting firm." This would preclude the firm from engaging in beneficial relationships, which enhance auditor effectiveness and independence.

Of most concern to me is the SEC's rush to regulate. While doing so they have:

• Adopted a schedule designed to avoid Congressional oversight and preclude meaningful public participation.

• Waited until the eleventh hour of the Clinton Administration to push through a radical rule.

• Limited to 75 days the period for commenting upon a far-reaching and highly complex proposal.

• Pre-empted the work of the ISB.

• Not allowed time for important recent reforms to work, including new disclosure and audit committee requirements adopted by the ISB, NYSE, NASD, AMEX, and SEC.

One of the most significant impacts of this proposed rule will be the negative effect on the recruiting of audit professionals. Why would someone want to work in a profession where up to half of all income generating work is "off-limits?"

In conclusion, this proposed rule is outside the scope of the SEC, is too broad, and fundamentally alters a profession which is considered to be the most honest of all professions. Accordingly, this scope of services rule must not be allowed to go forward. I look forward to your help in making this proposed rule disappear.

Very truly yours,

David W. Evans
Certified Public Accountant

DWE/te
C: Congressional Representatives