September 8, 2015
I am responding to this request for comment as both an auditor and audit committee chairman of a small public company.
I believe audit committees have enough safeguards in the existing rules to make them effective. I also believe auditors have enough safeguards to ensure they are independent and are conducting their audits effectively and efficiently. The various proposals submitted for comment seem redundant and unnecessary in accomplishing the missions of the two parties, the audit committee and the auditor.
It is imperative for audit committees to exercise sound judgment and to have frank and open dialogue with all parties involved in the audits and attestation functions. I believe the proposals would make the committee's functions more prescriptive (check the box) at the expense of objectivity. We don't want audit committees bogged down with making sure they have covered all of the disclosure elements that would come from most of the proposals. We also don't want the audit committee not to be exercising good judgment for fear that everything is disclosed opening them to potential criticism for their views and or decisions. I think these proposals are akin to micromanagement of the Committee's functions and I believe it will be even harder to recruit qualified individuals to serve on this committee.
Many smaller companies do not have the resources to devote to disclosures of the nature being proposed. I can't imagine how an audit committee could comply with many of these proposals unless they hired additional staff. I fail to see any cost benefit to this.
Thank you for allowing me the opportunity to respond and I commend the Commission for its efforts.