Audit Committees Take Time and Talent


The article, “ CPAs as Audit Committee Members ” ( JofA , Sep.03, page 32) was very informative and useful. However, as a former audit partner with one of the larger international CPA firms for 29 years and currently the chairman of an audit committee, I believe there are certain overriding themes that need to be emphasized.

The main point I want to emphasize is that after the Enron, WorldCom and other financial debacles, this is not the time for CPAs to be timid and/or nonassertive. If they are going to serve on audit committees (and I believe this is desperately needed) let them do the job properly.

The accounting profession needs leadership. If a CPA joins an audit committee, he or she must be sure the organization’s audit committee charter adheres to his or her principles and matches the current standards for audit committees in light of Sarbanes-Oxley. Otherwise, the individual needs to obtain an up-front commitment that the charter can and will be changed. While there may be a few problems with the details, in my opinion, the spirit of the Sarbanes-Oxley legislation has some merit.

The article recommended reading the audit committee’s charter to determine the breadth of the scope with respect to time commitment. Several of the larger accounting firms have written model audit committee charters that are generally quite comprehensive. Upon examination, it is hard to argue with any of their contents and also fairly easy for a private company or a nonprofit organization to tailor the model charters. However, the implementation of such a charter on a day-to-day basis takes a lot of talent and a significant commitment of time. I believe the article was a little off on the required time commitment. To serve as the chairperson of an audit committee and/or the “financial expert” takes a lot of time and talent.

The financial community is in a crisis, or at least a perceived one, from a financial governance standpoint. It would serve this country well if all CPAs did their jobs properly in all respects, especially if they were going to be on an audit committee.

Thomas G. King, CPA
Darnestown, Maryland


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