Does Rule 2-01(c) (4) (i) (bookkeeping services) preclude an auditor from assisting an audit client in preparing its financial statements?
“Assistance” can take many forms. As a general matter, Rule 2-01(c) (4) (i) sets forth in rule form the Commission’s previous guidance on this subject. In particular, the Codification of Financial Reporting Policies provides that: “It is the Commission’s position that an accounting firm cannot be deemed independent with regard to auditing financial statements of a client if it has participated closely, either manually or through its computer services, in maintenance of basic accounting records and preparation of financial statements, or if the firm performs other accounting services through which it participates with management in operational decisions.
