Date:    09/25/2000  1:51 PM

     
Jonathan G. Katz, Secretary
     
Securities and Exchange Commission
     
450 Fifth Street, NW
     
Washington, D.C.  20549-0609 
     
Reference file No. S7-13-00
     
 Mr. Katz:
     
 I am writing this letter to voice my opposition to the Securities and Exchange
Commission's proposed rules governing auditor independence.  The proposed rule 
is not only unnecessary, but would also have a devastating effect on our firm 
and services required by our many small, privately-owned client businesses.
     
 I am concerned that the new guidelines will severely restrict our firm's
ability to provide these needed non-audit services to our small audit clients. 
These sweeping changes are in response to a few "independence" problem 
encountered only on "large" audits of publicly held companies.
     
 The Securities and Exchange Commission has based its decision to move forward
with this rule prohibiting non-audit services without facts or evidence.  Even 
the Securities and Exchange Commission admits that there is no empirical 
evidence that non-audit services have compromised audit quality or auditor 
independence, nor ever caused an audit failure.  None of the studies or reports 
cited by the Securities and Exchange Commission concluded that the scope of 
services impaired audit effectiveness, or that an exclusionary ban was necessary
or appropriate.
     
 In a rush to regulate, the Securities and exchange commission has limited to 75
days the period for commenting on a far-reaching and highly complex proposal, 
including responding to more than 400 questions, collecting and analyzing a 
great deal of data and considering alternative concepts for regulating auditor 
independence.
     
 In conclusion, the Securities and Exchange Commission's proposal to restrict
the services offered by accounting firms represents a fundamental restructuring 
of a profession that has successfully given our local banks and investors the 
reliable, independent data they need for the past century.  A decision by a 
government agency to tell some business organizations what services they may 
offer and to tell other businesses from whom they can buy services is an 
extraordinary economic intervention without any empirical or other basis.
     
 This scope of services rule must not be allowed to go forward.
     
 Respectfully submitted,
     
     
     
Bernadette Smith, CPA