Date:    09/08/2000  11:05 AM

Subject: S7-13-00

I am writing to object to the  rule changes proposed by the Commission regarding
auditor independence.  Those portions of the proposal that deal with 
restrictions on services that can be provided by independent auditors overstep 
the needed reforms.  Small registrants especially will be negatively impacted by
these proposals and will be forced to find different service providers for each 
service.  Companies have come to rely on their accounting firm to coordinate 
services and serve as the the enterprise accountable to the "Board" if service 
or delivery problems result.  Clearly there are cost and efficiency issues that 
many have spoken to already.  
     
For years the Commission has looked to the Board of Directors to represent the 
shareholders' interest in many areas including the role of the auditor.  We in 
the profession take our role very seriously as it relates to the Board. 
Conflicts in independence both in appearance as well as in fact should be the 
responsibility of the "Boards of Directors" .  We serve at their pleasure and 
report to them.  My experience with Boards and Audit Committees has been 
positive and helpful.  I believe that these men and women take their role 
seriously and do a good job of oversight.  The Commission should modify these 
proposals and allow complimentary services to be provided subject to specific 
oversight and approval of a Registrant's Board.  
     
Expanded disclosure of specific services rendered,  the approval process  and 
any consideration of conflict and how it was resolved would put the  entire 
relationship in clear view.  The requirements for disclosure of "certain 
transactions" already exists in the reporting environment.  Registrants take 
great care to disclose conflicting relationships and the dollar amounts 
involved.  
     
Provide guidance to boards, auditors, and the public.  Keep watch and take 
administrative action where abuse occurs.  Do not regulate behavior to the 
detriment of the companies that you regulate and do not regulate commerce in the
mistaken notion that  rules on perceived conflict will reduce audit failures. 
The unintended consequences of the Commission's actions may have far reaching 
effects on both the accounting profession and the clients they serve.  
     
Edward C. Drosdick