Breathing some life into an idea auditors are trying feverishly to snuff out, retired TIAA-CREF chairman John Biggs has told auditor regulators that public companies should be required to change auditors after 10 years.
His remarks, in a recently posted letter to the Public Company Accounting Oversight Board, are among the few comments the board has received advocating audit firm rotation, a controversial idea vehemently opposed by the accounting and business groups.
Since floating the idea in August, the PCAOB has received 620 letters, about 20 times the normal amount, with most warning of unintended consequences if rotation is passed.
Chief among the critics are auditors, who warned rotation would raise audit costs and hurt the quality of audits as new audit firms got up to speed. Board audit committees also complained about rotation, saying it would usurp their choice over auditors, a responsibility given them by the Sarbanes-Oxley Act. And financial officers at some large companies said they might have trouble finding a new auditor at all because of the shortage of firms with necessary industry expertise.