What does “professional capacity” mean within the context of the auditor independence test as set forth in Section 303A.02(b)(iii)?
Even after recent changes in the accounting industry, independent auditing firms often offer a range of services, not all of which were intended to be covered by the term “professional capacity.” The NYSE intends the term “professional capacity” to cover those individuals participating in the firm’s audit and assurance and tax compliance (but not tax planning) practices in non-support roles. We were not intending to cover clerical or administrative personnel (whether or not they participate in the audit and assurance or tax compliance practices). While our answer is intended to assist companies in complying with Section 303A.02(b)(iii), we recognize that audit firms may have differing internal organizational structures and personnel designations and there may be situations in which a person’s “professional capacity” remains in question. In such situations, we encourage listed companies to contact the Exchange to discuss the particular circumstances in question.
