Accounting Watchdog Reiterates It Will Disband

The Public Oversight Board, the accounting industry watchdog, Thursday reiterated its intention to disband by the end of March despite a plea from Harvey L. Pitt, chairman of the Securities and Exchange Commission, to reconsider.

Charles A. Bowsher, the board’s chairman, notified Pitt in a one-page letter, saying in part: “Given the recent events and the SEC’s proposal for a new structure, we believe that we cannot effectively oversee the activities of the accounting profession and it would mislead the public to seem to do so.”

The five-member panel voted unanimously to disband after Pitt had failed to consult the group before unveiling his own proposal for a new oversight system for the accounting industry in the wake of the Enron Corp. debacle.

Pitt believes that the Public Oversight Board’s independence is compromised because the board receives all its funding from the American Institute of Certified Public Accountants, the industry’s trade group.

Bowsher has said he fears the new board proposed by Pitt could come to be dominated by the accounting profession. The Public Oversight Board, despite its funding source, has no members with direct ties to the Big Five accounting firms.

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Thomas S. Mulligan