NEW YORK (AP) _ Hoping to move quickly to restore investor confidence in the wake of Enron, the Securities and Exchange Commission has begun an unusual set of public discussions on auditor oversight and corporate disclosures as it moves to tighten regulations.
SEC chairman Harvey Pitt is also due to testify before the Senate on Thursday to seek more funding and personnel for his agency as it takes on additional work dealing with investigations as the shakeout from Enron continues.
``There are going to be a lot of additional responsibilities we are going to have to look at,'' Pitt told reporters at the conclusion of the first public roundtable discussion in New York. ``This is not a six-month project. We need to move much more rapidly.''
The SEC is planning another panel discussion with business leaders and legal experts in Washington Wednesday, and other sessions in the future.
At the New York panel, Pitt and SEC commissioner Cynthia Glassman heard opinions from Berkshire Hathaway chairman Warren Buffett, New York Stock Exchange chairman Dick Grasso, several legal experts and the chief executives of Pfizer Inc. and Deloitte & Touche, one of the five major accounting firms.
Buffett called for ways of making auditors less beholden to the management of the companies whose books they are auditing and more accountable to shareholders. He said auditors should be forced to give more detailed opinions on how aggressive they believe a company is being in their accounting practices.
``Managements push for the ultimate in earnings, and sometimes they do it operationally and sometimes they do it by accounting,'' Buffett said. ``In absence of being put on the spot, an auditor won't be critical of a client. They've got to be more scared of you (the shareholder) than the client.''
Mel Weiss, a major litigator of shareholder class-action lawsuits, suggested a new body to oversee auditing firms that would have sweeping powers to do spot audits, issue subpoenas and take other actions, saying the SEC didn't have the resources to do all the oversight itself.
``The SEC has been almost consistently starved of resources,'' Weiss said.
Pitt has said the SEC plans to propose a new oversight body for the accounting profession in the wake of the bankruptcy of Enron, which used questionable accounting methods to conceal large amounts of debt from shareholders. The role of Arthur Andersen, Enron's auditor, is being investigated in the Enron bankruptcy.
Pitt is also planning to testify before the Senate Appropriations Committee on Thursday to seek greater funding and personnel for the commission, which he says has been badly understaffed in dealing with all the additional enforcement following the Enron collapse.
The SEC has planned another roundtable discussion in Washington on Wednesday to discuss the issues of corporate disclosures and auditor oversight, and Pitt said he planned to schedule several more as the agency refines its rule proposals.