AUDITING - US Chamber of Commerce

Auditing: A Profession at Riskjolts the confidence of clients or partnershas the potential to immediately destroyan audit firm, even if that indictment orjudgment is later overturned or reducedon appeal.Furthermore, these legal risks are souncertain — and their implications are sodire — that the profession is effectivelyuninsurable. Without this standard toolfor business planning and protection, theprofession sits on a knife’s edge.This is not only bad for firms and theirclients, but it also makes the auditingprofession increasingly unattractive tohigh-quality personnel. Qualified auditorsface ever-growing incentives to exercisetheir professional options and may opt toleave the profession altogether.It is vital that we better define theresponsibilities and appropriate potentiallegal risks of the profession and establishthe conditions that would allow forcommercial insurability and, therefore,stability. Part of the answer may involvetort reform. The U.S. Chamber Institutefor Legal Reform is the nation’s premieradvocate for bringing rationality back toour legal system, and we stand ready tosupport responsible options for bringingtort relief to the auditing profession.However, even short of comprehensivetort reform, we believe that the followingfour initiatives could have a substantially8