September 14, 2000

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

Dear Mr. Katz:

Atkinson & Co., Ltd., a local CPA firm in Albuquerque, New Mexico has had an opportunity to review the Securities and Exchange Commission, Revision of the Commission's Auditor Independence Requirements; Proposed Rule, 65 Fed. Reg 43, 148(2000). There are certainly parts of the proposed rulemaking that would alleviate certain overly burdensome restrictions on investments and employment relationships involving audit clients and the families of certain audit firm personnel, however, the most significant impact of the proposed rule would dramatically curtail the ability of CPA firms such as ours to provide services other than audit and certain tax services to our customers. As a result, we would ask that you reconsider the scope of services rule for the following reasons:

• The Panel on Audit Effectiveness of the Public Oversight Board, a panel that was formed at the request of the SEC, concluded, "both the profession and the quality of audits are fundamentally sound." The panel also said it could find no evidence that the provision of non-audit services has hurt audit quality, but that in numerous instances non-audit services actually contributed to a more effective audit.

• As a firm we conduct a minimal number of SEC engagements, however, we are concerned that your proposed rule would set a precedent for other regulators. As a result, CPA firms that do not audit SEC registrants could also be impacted by these new rules.

• The proposed rule would restrict public companies' freedom of choice when seeking outside professional services. A registrant would have to choose whether to hire a firm solely as its auditor or solely as a provider of other services. As a result, a public company might be compelled to dismiss an audit firm that has done consistently outstanding work in order to obtain services from the auditor's non-audit colleagues.

• Lastly, the proposed scope of services rule would create a negative effect on recruiting and retention of the best talent. The best audit professionals will not want to be at a firm where 25-40% of the market is "off-limits". The "audit-only" firms endorsed by the proposal will have difficulty attracting the necessary talent from accounting and information technology programs, because the best talent will be drawn to industries with broader career opportunities.

We believe that the proposed scope of services rule will more than likely have the perverse effect of undermining auditor independence by making audit firms overly or exclusively dependent on auditing fees, which would certainly be contrary to the public interest. The CPA profession has successfully given investors the reliable, independent data they need for the past century. Allow us to continue to protect the public interest by not going forward with your proposed scope of services rule.

Sincerely,

Atkinson & Co., Ltd.
Barbara A. Lewis
Shareholder in Charge of Audit