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> Get Articles > Accounting and Book-Keeping > Is Your CPA “Independent”? Is Your CPA “Independent”? Download as PDFNevin Sanli nsanlisphvalue.com Sanli Pastore & Hill, Inc. http://sphvalue.com It is important to be aware of the rules under which your vendors operate. With respect to business valuations, it is caveat emptor when you have your CPA prepare a valuation. Pursuant to the Securities and Exchange Commission's (SEC) recently issued amendments to Rule 2-01 regarding audit or Independence under the Securities Exchange Act of 1934: "…an [auditor] is not independent [of its audit client] if the accountant provides appraisal or valuation services or any service involving a fairness opinion." The SEC's logic is as follows: "[I]f an audit firm provides these services to an audit client, when it is time to audit the financial statements the accountant could well end up reviewing his or her own work, including key assumptions or variables suggested by his or her own firm that underlie an entry in the financial statements." Ultimately, the risk to your company can be expensive and time consuming, as the SEC, Department of Labor and/or the IRS may require you to retain an independent firm to prepare a new valuation after you already have paid for it once. Additionally, damages may be incurred as a result of the original valuation. http://sphvalue.com/pdf/IsYourCPAIndie.pdf --- Nevin Sanli is President and Co-Founder of Sanli Pastore & Hill, Inc. Mr. Sanli, an Accredited Senior Appraiser (ASA), Business Valuation Discipline, of the American Society of Appraisers, and has valued over 1,000 businesses during his career. He specializes in providing expert witness testimony in litigated cases involving business valuation, and frequently speaks on business valuation to professional organizations. Mr. Sanli earned a Bachelors in Honors Economics from the University of California at Irvine. Mr. Sanli can be reached at (310) 571-3400 or mailto:nsanlisphvalue.com. How useful did you find this article? This article can be downloaded freely from http://www.get-articles.com and used on your website or in your ezine so long as the author is credited and their resource box left intact. You should not change any links in the article, and where the article is used on a website it's links should be clickable. Please see our terms and conditions page for more information: http://www.get-articles.com/authors-publishers-terms.php |
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