What type of non-audit advisory services can an audit firm provide?
The Sarbanes-Oxley Act of 2002 mandates that audit committees be directly responsible for the oversight of the engagement of the company’s independent auditor, and the Securities and Exchange Commission (the Commission) rules are designed to ensure that auditors are independent of their audit clients.
To determine whether an auditor is independent under this standard an audit committee needs to consider all of the relationships between the auditor and the company, the company’s management and directors, not just those relationships related to reports filed with the Commission. The audit committee should consider whether a relationship with or service provided by an auditor:
There are certain non-audit services that are always prohibited. The SEC and the AICPA do not list out any non-audit services that are automatically approved. Instead, it lists out some examples of non-audit services that can be approved by the audit committee. Below is a list of services that must be pre-approved vs those non-audit advisory services that are prohibited:
Learn more @ https://www.sec.gov/info/accountants/audit042707.htm
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