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advocacy community education
5
a d v o c a c y
To the Editor
Hartford Business Journal
15 Lewis Street, Suite 200
Hartford, CT 06103
As the executive director of the Connecticut Society of Certified Public
Accountants for almost 15 years, I am a regular reader of the Hartford
Business Journal. With this as my frame of reference, I am compelled to
respond to the article, "Absurdity of audits raises value question" by
Michael Smith in the June 27, 2011 issue of the Hartford Business
Journal. Smith's obvious disdain for the public accounting profession
leads him to make a number of points that merit clarification or refutation.
Smith questions whether CPAs make good candidates for chief financial officers. While he
asks this question, he does not mention that a significant number of CFOs are, in fact, CPAs
who have moved into positions of corporate leadership.
Smith clearly suggests that the audit process should have alerted us all about the financial
crisis that was on the horizon in 2007. This is an extreme and unique position for anyone to
take, especially for a CPA who knows what an audit is and what it isn't.
In the wake of the great recession, Congress passed sweeping new financial legislation, the
Dodd-Frank Act, that addresses virtually every aspect of the financial catastrophe we experi-
enced. Given the scope and depth of the Dodd-Frank Act, it's hard to conclude that financial
statement audits were at fault, when the auditing process was not a subject of Dodd-Frank.
Smith also goes back in history to include mentioning several notorious situations of senior
management collusion to mislead both auditors and the public. He does not mention that
there are approximately 15,000 audits of publicly held companies in this country each year.
These audits help our capital markets maintain their leadership position in the world.
Finally, in order to make his point, Smith includes a reference to Bernard Madoff's audited
financial statements as being used to mislead investors, etc. This is blatantly unfair:
Madoff's auditor admitted to issuing an audit report without performing any of the audit work.
In my opinion, the author of "Absurdity of audits raises value question" unfairly disparages
the audit process.
Sincerely,
Arthur J. Renner, CPA
Executive Director
Connecticut Society of CPAs
Executive Director Renner Refutes
Hartford Business Journal
Article
In response to an article titled "Absurdity of audits raises
value question" by Michael Smith in the June 27, 2011
Hartford Business Journal, CSCPA Executive Director Art
Renner submitted the following letter to the editor, which
was published in the July 11, 2011 Hartford Business
Journal. Smith's original article is available on the Hartford
Business Journal website at www.hartfordbusiness.com.