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Subject: Removal, Suspension, and Debarment of Accountants from Performing Annual Audit Services
Date: September 3, 2003
To: Chief Executive Officers of All National Banks, Federal Branches and Agencies, Department and Division Heads, and All Examining Personnel
Description: Publication of Final Rule
The attached final rule, published in the Federal Register on August 13, 2003, concerns the removal, suspension, and debarment of accountants from performing annual audit and attestation services. The final rule will become effective on October 1.
Section 36 of the Federal Deposit Insurance Act (FDIA) requires that each national bank with $500 million or more in total assets submit an annual report on its financial statements and required management assessments to the Comptroller of the Currency (OCC). An independent public accountant must audit these financial statements to determine whether they are presented in accordance with generally accepted accounting principles.
The final rule amends 12 CFR 19 to establish rules of practice and procedure for the removal, suspension, and debarment of accountants from performing section 36 annual audit services. The rule does not create new standards for the accounting industry, but rather relies on existing statutory, regulatory, and professional requirements, such as generally accepted auditing standards. This final rule was issued jointly by the OCC, the Board of Governors of the Federal Reserve System (FRB), the Federal Deposit Insurance Corporation (FDIC), and the Office of Thrift Supervision (OTS). The agencies' final rules are substantively identical.
For further information, contact Mitchell Plave, counsel, Legislative and Regulatory Activities Division, (202) 874-5090, or Richard Shack, senior accountant, Office of the Chief Accountant, (202) 874-4911.
Julie L. Williams