I raised my eyebrows when I scanned “New Rules, New Responsibilities” ( JofA, Aug.00, page 53). The section, “Quarterly independent audits,” (page 55), contained a small, but important, error.
In the text that followed, the author noted “Under SEC rules, a company must have an independent public accountant review its quarterly financial statements before filing them with the SEC. This requirement previously applied only to annual financial statements.”
Readers unfamiliar with the SEC’s requirements may be somewhat confused. I believe the author wants readers to know independent audits have been required on an annual basis for SEC filers but that now reviews of quarterly financial statements also are required.
In my opinion, this issue is extremely important. Much of the general public does not understand what an audit entails, much less a review. It would be unfortunate if an article in the JofA added to the confusion.
Robert J. Dosch, CPA
Assistant Professor of Accounting
University of North Dakota
Grand Forks, North Dakota