Business: Auditing the Auditor

No profession has suffered a more painful drop in public esteem than accounting; in recent years accountants have been regularly criticized for failing to expose corporate shenanigans, and have been sued for allegedly certifying misleading company earnings reports. Four SEC complaints have been filed against Peat, Marwick, Mitchell & Co., onetime auditor of such tarnished firms as Penn Central and National Student Marketing and a giant of the profession (it recorded worldwide billings of $370 million in 1973). Last week Walter E. Hanson, 48, a former railroad accountant and senior partner (chief executive) of Peat, Marwick since 1965, moved to restore...

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