Thanks for a substantial, well-documented, and useful article--"Who can you trust?" (Cover Story, Oct. 5). You offer a range of specific, down-to-earth suggestions, and I would hope to see some of them materialize.

Two additional proposals:

1. Fees to investment bankers for arranging unions should be paid over time, maybe five years or more after the acquisition has taken place, and be linked to real performance over that period.

2. Analysts, investment bankers, and mergers-and-acquisitions brokerS should complement their due-diligence process with businesS analysis systems that take into account the important threats and assets that are not reflected in accounting. Such systems, well-tested, exist.

Hans V.A. Johnsson

Old Greenwich, Conn.

The certified public accountants who audit these rogue corporations know exactly what is going on. The supposedly unbiased and independent CPAs have made a conscious decision to put their stamp of approval on questionable and devious accounting practices. CPAs are hired by--paid by--the corporations they audit. CPA firms work very hard to get and keep their audit clients. There is a terrible tug of war in every CPA firm between requiring a client to be forthright and truthful in their financial reports and keeping the client and the lucrative fees. It appears to me that too often money wins over honesty.

Generally accepted accounting principles (GAAP) may not have specific rules for dealing with today's gigantic accounting shenanigans, but one GAAP requirement, apparently the hardest of all to deal with, will never change: to tell the truth, the whole truth, and nothing but the truth. Your last sentence--"What we need is more integrity--integrity in managers and integrity in their numbers"--is incomplete. What we need also is integrity in their CPAs.

Bernard B. Kamoroff, CPA

Willits, Calif.

Your article does an excellent job of discussing the incentive faced by executives, auditors, and analysts as they prepare or evaluate financial statements. One group, though, deserves further attention--audit committee members. The article calls for more audit committees consisting of "truly independent business people." What we really need are more committees consisting of "truly independent accounting and auditing experts."

Unlike many other board functions, the audit committee work is often technical, for it deals with accounting and auditing standards. You wouldn't let a non-attorney oversee legal compliance or a non-physician oversee medical issues, so why do we often have non-accountants overseeing the financial reporting?

Many boards try to turn good directors into good audit committee members. But without technical training in accounting and auditing, this can be difficult to accomplish. I would prefer to see more boards add accounting and auditing experts to the audit committee and then help these individuals to become good all-around directors.

Dana R. Hermanson

Director of Research

Corporate Governance Center

Kennesaw State University

Kennesaw, Ga.

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