Non-Audit Services and Perceived Independence: Some New Evidence.

This paper examines auditor activity in the area of non-audit services, and its impact on users' perceptions of auditor independence. To examine actual current activity, the authors present summary findings from a random sample of 100 corporate proxy statements. (ASR #250 recently mandated disclosure of any significant non-audit engagement of the principal auditor in these statements.) Subsequent queries of both relatively sophisticated and relatively naive users, after exposure to ASR #250 type disclosures, suggested high confidence in the auditor persists across a wide variety of services.