Audit rotation misinformation.

• Position: SOX SEC. 203 - Brief Article

While auditor rotation has been bandied about in the wake of the Sarbanes-Oxley Act, there is no requirement for public companies, government entities or nonprofits to change audit firms.

For publicly held companies, SOX Sec. 203 requires that audit partners must rotate off of the audit every five years, but the same audit firm can be used.

For government entities, a November 2003 GAO report found that "... mandatory audit firm rotation may not be the most efficient way to ... improve audit quality considering the ... loss of institutional knowledge of the public company's previous auditor...