The Securities Exchange Commission has issued Proposed Rule S7-13-00 Revision of the Commission's Auditor Independence Requirements.  The proposal has major ramifications for internal audit departments:

General Standard for Independence

"...the four principles incorporate situations that we believe reasonable investors would agree impair an auditor's independence.  They are when the auditor:

• has a mutual or conflicting interest with the audit client

• audit's the accountant's own work

• functions as management or an employee of the audit client

• acts as an advocate of the audit client"

The proposed four principles place restrictions on external audit firm's involvement in systems development initiatives and business process outsourcing.  Specifically on internal audit outsourcing:

"Proposed Rule 2-01(c)(4)(i)(E) provides that an auditor is not independent when the auditor performs certain internal audit services for an audit client or an affiliate".

SEC has requested comments by 9/25/00 at www.sec.gov.

The Best of the Best for 2006

RBIA Gold Medal
Ms. Martha Mimica, Florida Power & Light

RBIA Silver Medal
Mr. Bill Egan, Scotts Company

RBIA Bronze Medal
Mr. Dan Ashley, Qwest Communications

Congratulations!
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Updated: February 2, 2007