Revised S.E.C. rule on "accountants' certificates" ;

              Statements on Auditing Procedure
No. 5
February 1941
•
Issued by the Committee on Auditing Procedure, American Institute of Accountants, 13 East 41st Street, New York, N. Y.
Copyright 1941 by American Institute of Accountants
The Revised S.E.C. Rule on "Accountants' Certificates"
THE REVISED rule of the Securities and Exchange Commission re-garding accountants' certificates known as rule 2-02 was issued on February 5, 1941, and is effective March 1, 1941.
The rule in draft form was the subject of consideration and discus-sions with the Commission for several months, and during this period there have been a number of meetings, considerable correspondence, and two formed hearings before the Commission. Since the release of February 5, 1941, letters have been exchanged between the commit-tee and the Commission as follows:
SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C.
GENTLEMEN:
This committee has given consideration to the Commission's release of February 5, 1941, covering the revised rule regarding accountants' certificates contained in amendment No. 3 to Regulation S-X. In view of the fact that the amendment becomes effective on March 1, 1941, and in conformity with the purpose of the American Institute of Ac-countants to cooperate to the fullest possible extent with the Commis-sion, this committee deems it desirable that a suggested new form of certificate for use in connection with financial statements filed with the Commission should be put forward promptly which will be ac-ceptable to the Commission.
The committee believes that the new requirements in the normal case can be met by the insertion of an additional sentence immediately following the present statement regarding the extent of the audit, and that the language of this sentence should follow as closely as pos-sible that of the release. In substance, the statement of the auditors which we ask the Commission to approve would be: "In our opinion our examination was made in accordance with generally accepted auditing standards applicable in the circumstances and it included all procedures which we considered necessary."
The amendment apparently contemplates that any such statement should be made as a statement of fact. However, the release clearly
37