Split SEC Relaxes Certain Auditor Independence Rules

Law360 (October 16, 2020, 4:29 PM EDT) -- A divided U.S. Securities and Exchange Commission on Friday agreed to ease auditor independence rules by granting auditors more leeway to assess conflicts-of-interest violations involving the companies they oversee, drawing dissent from opponents who worry the changes go too far.

Auditor independence rules are in place to ensure the impartiality of firms that review the integrity of an SEC registrant's financial statements and related disclosures. The SEC said its rule change would rectify instances in which certain auditor relationships with their clients may trigger technical violations of independence rules that don't compromise the auditor's objectivity.

SEC Chairman Jay Clayton said the...

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