Date: January 17, 2002

Re: PCPS Communications on Enron

To: William Balhoff
       Chairman, PCPS Executive Committee

Dear Mr. Balhoff,

Thank you for the communication regarding a new regulatory model, it was the third one this morning.  I very much appreciate hearing from someone in your position rather than a faceless email as were the other two.

I continue to be very upset with my own trade association, the AICPA.  Now, Arthur Anderson may have commited fraud and our firm and clients have to pay the price.  CPAs in my home State as well as our bloated standards are not to blame for Enron.

Please do not allow the AICPA to be publicly blamed for Enron by taking actions that indicate that our profession should take a level of responsibility for a member's fraud.  Rather, the AICPA should admit it was wrong last year when it asserted against common sense all non-audit fee levels have no impact upon professional judgment but rather expand the auditor's knowledge of their client's transactions.  What a line of bull, the truth is that it allows greed to foreshadow professional judgment.  Did the AICPA really think that the auditors were also performing the consulting work?  The high road is for the AICPA to step back and look at its actions, actions which do not serve the so called rank and file like me.

More than anything, I am frustrated with the burdens of standards which remove professional judgment from my craft and those that regulate such indirectly on my behalf.  Enron is the proof that you can not regulate professional judgment.  It will be the shareholders and bond holders that will punish Arthur Anderson, it not necessary for the AICPA to punish its members for good measure too.

CPAs have permitted their own association to govern without their input.  Its time, and technology now permits, the AICPA to convert to a membership plurality voting mechanism on all standard setting issues since, as the expensive XYZ debacle demonstrated, members can't hire and supervise people to represent them, we need to represent ourselves.

Thank you for listening to my concerns.

Very Truly Yours,

Dana Scott Beane, CPA



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