Tel (425) 644-4800
Fax (425) 562-8853

902 140th Ave NE
Bellevue, WA

September 18, 2000

Jonathan G. Katz, Secretary
Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549-0609

Reference: File #S7-13-00

The Washington Society of CPAs (WSCPA) consists of 9,000 members who represent all facets of the types of work that CPAs perform, including members in public accounting firms (national, regional and local), members in industry (including CFOs, controllers, internal auditors, financial personnel and entrepreneurs), members in government and members in education. As those who work directly with businesses and organizations of all sizes and types, we are strongly opposed to the SEC's proposed rules with respect to Auditor Independence, and urge you to direct Chairman Arthur Levitt to withdraw this proposed rule.

We echo previous letters that you have received, which criticize the proposal based upon the lack of process, and the SEC's ignorance of the conclusions of the Panel on Audit Effectiveness of the Public Oversight Board. We also agree that there is no empirical evidence which would indicate that the provision of non-audit services has compromised audit quality or contributed to audit failures.

Our emphatic request is that you seriously consider the negative impact which this proposal would have, if implemented, upon businesses of all sizes and types, and for the investors therein. The ramifications of this proposal would be the necessary segregation between those CPAs who provide audit services, and CPAs who provide other accounting and consultive services. Clients would have to choose one firm to perform its audit, and another firm for other needed services. This would be harmful for businesses and their investors:

Although the proposal, as drafted, would only apply to SEC registrants, this proposal is bad for small business:

As the representatives of the CPA profession, we are concerned and frustrated when audit failures do occur. We would love to see a world where there were no incidences of audit failure whatsoever, but we cannot possibly endorse the SEC's proposal as the way to make that happen. Indeed this proposal would actually place us further from that goal. This proposal would have a negative impact on audit quality, which is contrary to what both the SEC and the WSCPA would seek to achieve.

Thank you for your consideration of this input.

Respectfully submitted,

Bea L. Nahon, CPA, President