Responses of the American Accounting Association's Tracking Team to the Recommendations of the Advisory Committee on the Auditing Profession

In fall 2007, the US Department of the Treasury's Advisory Committee on the Auditing Profession (Committee) began its deliberations. Co-chaired by former Securities and Exchange Commission (SEC) chairman Arthur Levitt and former SEC chief accountant Donald Nicolaisen, the Committee was composed of distinguished members from a variety of groups, including accounting practice, law, industry, and academia. The three authors of this commentary served on the American Accounting Association's Treasury Tracking Team, charged with monitoring the Committee's activities and responding to calls for comments on proposed recommendations. The recommendations are divided into three sections, consistent with the organization of the Committee's charge and with its reports. These are: 1. human capital, 2. firm structure and finances, and 3. concentration and competition. The authors believe that many of the Committee's recommendations will serve to promote audit quality and the long-term viability of the public company auditing profession.