I could present it to you in another way where I said, „You have to keep in mind that while they might
People don’t act on —
ANTLE: I think you have to ask seriously how well-grounded in fact they are. I’m not saying sweep them under the rug but how well grounded in fact are these alleged perception problems.
ANTLE: I don’t think irrelevant in the sense that you would presume, as your questions have, that theremust be something underlying some of these. So you should definitely explore it.
But we know lots of cases where perceptions have been vastly wrong, the world is flat, that sort of thing.
COMMISSIONER UNGER: But underlying the discussion is the fact that the federal securities laws give accountants a franchise, because all of our statements, all the statements that must be filed with the Commission most of them have to have audited financial statements.
ANTLE: I agree with that entirely. The franchise that’s given and that it’s the Commission’s responsibility to maintain and protect I think should be an important element in the consideration of these matters.
And that’s why also I think that you’re entirely right in delving into these matters and going into these matters, exploring them as deeply as possible and having whatever dialogue and study needs to be done to clarify them, because that franchise is a valuable thing that our government and my government has given these firms, and ithas responsibilities.
COMMISSIONER UNGER: Who performed these consulting services before the accounting firms? Is this a new demand for this type of service, and now it’s being met by the firms, or is this a shift in business from some other part of the economy to the accounting firms?
ANTLE: Well, there are probably people better qualified than I, but I think there’s a lot of growth in services that they and others have innovated, which is why, in part of my remarks, I wanted to underscore the fact that I believe they’ve been the incubators of a lot of valuable services.
ANTLE: Or at least they’re taking maybe even existing services and pushing them into new market areas, and so on. Their economic success tells me that they’ve been successful in finding some way to get more profit out of that.
But again, this gets back to my call for study because the reality is we don’t fully understand https://rksloans.com/title-loans-nv/ the dynamics of especially consulting relationships. We could understandthat an audit, on average, might last, you know, 14, 15, 20 years, but how do consulting relationships? What’s the dynamics there?
So when we start talking about how an auditor might compromise an audit for consulting profit, well, is it a one-year consulting job? Is the dynamic such that one leads to another leads to another?
We don’t know those kind of things, and those are fundamental questions about the economies of scope I think that we need to understand.
COMMISSIONER HUNT: Well, Professor Antle, I would just say because we’re going to also have a dialogue, I think I have seen some cases where I do not understand the judgment call made by the accountant but for the importance of non-auditing service income. Now, that may be a perception that will prove to be wrong, but I don’t think so.
ANTLE: I think those need to be fully disclosed and discussed, and we need to really, you know, delve in. I think that as large as the public accounting profession is and as many partners as they have and as many situations as there are it would be kind of surprising if there weren’t some somewhere, and I think they need —