U.S. Treasury Department forms panel to look at audit profession.

U.S. Treasury Secretary Henry Paulson Jr. on Oct. 2 formed an advisory panel to study and make recommendations on the future of the audit profession in relation to the capital markets. AICPA President and CEO Barry Mclancon, representing the accounting profession, was among 21 business leaders and experts named to the panel.

The new Advisory Committee on the Auditing Profession will be a public forum and its members represent small and large investors, auditors, financial institutions, public companies, regulators and academia. Its first meeting was held Oct. 15 (www.treasury.gov).

"Investor trust in the integrity of our capital markets is vital to the strength of the U.S. economy," Paulson said when announcing the formation of the committee. "The auditor's role is key: to examine financial statements and express an opinion that conveys reasonable, but not absolute, assurance as to the truth and fairness of those statements."

Treasury Undersecretary for Domestic Finance Robert K. Steel questioned whether there is enough competition in the auditing profession. The four largest accounting firms handle more than 90% of public...