Securities Lawyer's Deskbook                          published by The University of Cincinnati College of Law

Section 701 -- GAO Study and Report Regarding Consolidation of Public Accounting Firms

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1. Study Required. The Comptroller General of the United States shall conduct a study--
   
   
   1. to identify--
      
      
      1. the factors that have led to the consolidation of public accounting firms since 1989 and the consequent reduction in the number of firms capable of providing audit services to large national and multi-national business organizations that are subject to the securities laws;
         
         
      2. the present and future impact of the condition described in subparagraph (A) on capital formation and securities markets, both domestic and international; and
         
         
      3. solutions to any problems identified under subparagraph (B), including ways to increase competition and the number of firms capable of providing audit services to large national and multinational business organizations that are subject to the securities laws;
         
         
   2. of the problems, if any, faced by business organizations that have resulted from limited competition among public accounting firms, including--
      
      
      1. higher costs;
         
         
      2. lower quality of services;
         
         
      3. impairment of auditor independence; or
         
         
      4. lack of choice; and
         
         
   3. whether and to what extent Federal or State regulations impede competition among public accounting firms.
      
      
2. Consultation. In planning and conducting the study under this section, the Comptroller General shall consult with--
   
   
   1. the Commission;
      
      
   2. the regulatory agencies that perform functions similar to the Commission within the other member countries of the Group of Seven Industrialized Nations;
      
      
   3. the Department of Justice; and
      
      
   4. any other public or private sector organization that the Comptroller General considers appropriate.
      
      
3. Report Required. Not later than 1 year after the date of enactment of this Act, the Comptroller General shall submit a report on the results of the study required by this section to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives.
   
   

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