To the members of the AICPA.

Here's another update on Institute activities driven by Enron-related developments. While we're using this update to keep you apprised of late-breaking news on this issue, the balance of The CPA Letter is devoted to all the other ongoing projects and programs that are equally important to members.

Legislation

We have testified before several congressional committees and subcommittees investigating many issues resulting from Enron's bankruptcy. On Mar. 14 we outlined four initiatives for the Senate Banking Committee that we believe strike an appropriate balance between the need for government oversight and the efficiency of the private sector. We pledged our support to Congress and the SEC in enacting proposals to: (1) create a new private-sector regulatory body responsible for performing quality reviews of the practices of public company auditors and for disciplining those auditors, (2) reform the financial reporting process by moving toward more timely -- and ultimately real-time -- disclosures and reports containing information about plans, opportunities, risks, uncertainties and the drivers of future success; (3) craft new rules to strengthen corporate audit committees; and (4) make it unlawful for anyone in a company, or anyone else involved in the financial reporting process, to lie to an auditor.

A panel of the profession's leaders was assembled specifically for that hearing: James Castellano, chair, AICPA Board of Directors; James Copeland, chief executive officer, Deloitte and Touche; William Balhoff, chair, AICPA PCPS (Partnering for CPA Practice Success) Executive Committee; Olivia Kirtley, AICPA past chair, current member of public company audit committees; and James' Gerson, chair, Auditing Standards Board. In addition to that heating, Barry Melancon testified before the House Financial Services Committee on Mar. 13. Jim Castellano also appeared before a House Energy and Commerce subcommittee to discuss our support and ideas for reform.

Whether it is through SEC regulations or legislative solutions, we emphasize that any new rules should pertain only to audits of public companies. We are very much mindful of the potential for such changes to be adopted by other government and regulatory agencies, which may affect CPAs' work for private companies. As when the SEC and General Accounting Office proposed rules on auditor independence, one of our overriding concerns was to minimize the final rules' harmful effects on non-public companies and their auditors. To boost our efforts on this point in the current situation, we activated our Federal Key Persons. Armed with information about the possible "cascade effect" and its ramifications, our Key Persons have been encouraged to communicate with their local members of Congress about this issue.

Media Relations/Advertising

We continue to mount an aggressive media relations effort to help maintain the public's trust in CPAs and in our capital market system.

For example, we participated in more than 125 print, television and radio interviews or news reports. We've appeared on such national television programs as CNN, MSNBC with Brian Williams, CNBC, CBS MarketWatch and Public Broadcasting Service's Nightly Business Report. Similarly, major daily newspapers from all over the country, such as the Chicago Tribune, Denver Post, The New York Times, The Wall Street Journal, Washington Post and San Francisco Chronicle, have interviewed us, as have CBS Radio and National Public Radio. Moreover, the Associated Press, Dow Jones, Reuters and Bloomberg news wires disseminated articles that included our input. Lastly, we also interviewed with many trade publications and national magazines.

Our message is always clear: Each day hundreds of thousands of CPAs, in big firms and small, in industry and government, do the right thing, protecting the public interest and serving the needs of employers and clients. We stress that the profession has a 100-year tradition of independence, integrity and objectivity, and that we will not tolerate those who break the rules.

To expand the scope of this message, a new, national ad campaign was launched on Mar. 10. The radio and print ads emphasize that every day CPAs across the country are auditing financial statements, providing tax services and delivering business insight. Radio spots have been airing nationally (more than 300 times in total) on network radio; full-page print ads were placed in The Wall Street Journal, The New York Times, USA Today, Washington Post, the L.A. Times, Dallas Morning News and the Chicago Tribune. In addition, some state societies have agreed to run the same radio or print ads in local media.

Communications to States, Members

State societies have always been important players in profession-wide initiatives, and this one is no exception. We have been providing the states with resources and tools to help them sort through the complicated issues and communicate with their members and other interested parties. Furthermore, the AICPA's Public Relations Team held a media preparation workshop with state society spokespeople to help them respond to related press inquiries.

The AICPA also created an electronic newsletter to keep members informed of emerging events. "AICPA News Update" provides a quick synopsis of legislative happenings and a rundown of press clips with livelinks to testimony and news stories, as well brief descriptions of non-Enron developments at the Institute. The first issue was e-mailed to members in early Mar. To receive this timely newsletter, send your e-mail address to our Member Satisfaction Center ([e-mail]). We also suggest members routinely visit www.aicpa.org, which is continuously updated.

You can see that your Institute is working very hard to maintain public confidence while balancing members' interests. We're at a critical time for the profession, and it's important for you to know that your leadership will take the necessary steps to ensure the profession remains vibrant and viable in order to meet our public interest responsibilities.