Following is an excerpt from the Sarbanes-Oxley Act of 2002.
To read the rest of TITLE II--AUDITOR INDEPENDENCE, see http://vscpa.com/Advocacy/SOtext.htm#sec201.
SEC. 201. SERVICES OUTSIDE THE SCOPE OF PRACTICE OF AUDITORS.
(a) PROHIBITED ACTIVITIES- Section 10A of the
Securities Exchange Act of 1934 (15 U.S.C. 78j-1) is
amended by adding at the end the following:
(g)
PROHIBITED ACTIVITIES- Except as provided in subsection (h), it shall be
unlawful for a registered public accounting firm (and any associated person of
that firm, to the extent determined appropriate by the Commission) that
performs for any issuer any audit required by this title or the rules of the
Commission under this title or, beginning 180 days after the date of
commencement of the operations of the Public Company Accounting Oversight Board
established under section 101 of the Sarbanes-Oxley Act of 2002 (in this
section referred to as the `Board'), the rules of the Board, to provide to that
issuer, contemporaneously with the audit, any non-audit service, including--
(1)
bookkeeping or other services related to the accounting records or financial statements
of the audit client;
(2) financial information systems design and implementation;
(3) appraisal or valuation services, fairness opinions, or contribution-in-kind
reports;
(4) actuarial services;
(5) internal audit outsourcing services;
(6) management functions or human resources;
(7) broker or dealer, investment adviser, or investment banking services;
(8) legal services and expert services unrelated to the audit; and
(9) any other service that the Board determines, by regulation, is impermissible.
(h)
PREAPPROVAL REQUIRED FOR NON-AUDIT SERVICES- A registered public accounting
firm may engage in any non-audit service, including tax services, that is not
described in any of paragraphs (1) through (9) of subsection (g) for an audit
client, only if the activity is approved in advance by the audit committee of
the issuer, in accordance with subsection (i).'.
(b) EXEMPTION AUTHORITY- The
Board may, on a case by case basis, exempt any person, issuer, public
accounting firm, or transaction from the prohibition on the provision of
services under section 10A(g) of the Securities Exchange Act of 1934 (as added
by this section), to the extent that such exemption is necessary or appropriate
in the public interest and is consistent with the protection of investors, and
subject to review by the Commission in the same manner as for rules of the
Board under section 107.
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