© D.L. Crumbley
Expert Service Unrelated to Audit
This covers engagements where the CPA firm’s specialized knowledge, experience and expertise support audit client positions in adversarial proceedings. The prohibition includes providing an opinion to the client or a client representative to advocate a client’s interests in litigation or in a regulatory or administrative investigation or proceeding. The rules do not define this term.
The examples involve the SEC Division of Enforcement, forensic accounting engagements for the client itself and helping the audit committee investigate potential accounting impropriety. The rules appear to reject the proposal that the advocacy prohibition be confined to public settings and allow internal investigations and fact-finding engagements for the audit committee, as well as providing factual accounts, testimony or explanations of positions taken, conclusions reached or work performed.
Source: T.J. Purcell, III and D. Lifson, “Tax Service After Saebanes-Oxley,” Journal of Accountancy, November, 2003, p. 37.