Investment Professionals

SEC’s Auditor Independence Proposal Would Undermine Investor Protection

CFA filed a comment letter with the SEC opposing key aspects of its proposed revisions to the auditor independence rules. Citing evidence from the SEC’s own enforcement actions and PCAOB staff inspection reports, CFA argued the proposed changes fail to adequately ensure that audits will be independent, thus placing investors at risk. CFA urged the agency to withdraw the proposals and “instead focus its attention on making the rules more enforceable, increasing accountability within firms for independence failures, and encouraging competition based on audit quality, which should indirectly help to enhance auditor independence. Unfortunately,” CFA wrote, “nothing in the current proposal would advance those goals.”