Financial Executives International (FEI) is urging the U.S. Department of Treasury to require U.S. auditing firms, like their European counterparts, to issue online transparency reports detailing important financial information and governance policies. The purpose of the proposal is to give audit clients and investors easier access to their credentials. It's only fair, says Christine DiFabio, FEI vice president of technical accounting activities. "If public companies need to be accountable, then audit firms need to be as well, because audit committees are making decisions that impact investors from both an audit and a financial reporting perspective."

Whether or not the recommendation moves forward will be up to the Treasury's Advisory Committee on the Auditing Profession (ACAP), a non-partisan committee co-chaired by former SEC Chairman Arthur Levitt and former SEC Chief Accountant Donald Nicolaisen. ACAP is considering several options to strengthen the auditing industry's financial soundness, bolster its ability to attract and retain qualified personnel and address concerns about industry concentration. Final recommendations are expected this summer. The idea of transparency reports has been raised in the past, but FEI wants to bring the issue to the front burner–ahead of the expected convergence in accounting standards.

In June, all public company auditors working in European Union member states must comply with the EU's own Article 40 transparency report decree. It forces audit firms to annually post reports on their Web sites that describe their legal and network structures and ownership details, governance policies, most recent quality assurance review, client list, confirmation of independence compliance review and continuing education policy. They must also display financial information, including audit fees, tax advisory fees, consulting fees and partner remuneration policies. And they must describe their quality control practices, with management providing a statement on their effectiveness.