PricewaterhouseCoopers Response to Speech by ArthurLevitt.

Business Editors

NEW YORK--(BUSINESS WIRE)--May 10, 2000

PricewaterhouseCoopers CEO James J. Schiro today issued the following endorsement of comments delivered by SEC Chairman Arthur Levitt earlier today.

"Chairman Levitt's recommendations are an important contribution

to the creation of a new regulatory framework for the American accounting profession that will enhance investor confidence while reflecting the realities of today's US economy. Combined with efforts to create global financial reporting standards, these initiatives will play a crucial role in providing a powerful backbone for the world's capital markets.

"PricewaterhouseCoopers is eager to continue working with the chairman to address the issues he raised today.

"I am pleased that Chairman Levitt has put our independence problems in the proper context, recognizing that the vast majority of infractions were minor and inadvertent. I am also gratified that the chairman has acknowledged the efforts we have made to address past independence problems and to implement a significantly modernized system for ensuring independence compliance in the future.

"The chairman has recognized that the independence rules themselves need to be modernized. As we have said for some time, the rules should apply, in the main, to people in a position to influence an audit and that rules extending to retirement plans and relatives and unfairly burden and discriminate against dual-career families and working women don't make sense.

"Funding for the POB's special independence compliance reviews must be continued. We are committed to providing our share of the funding and urge the other firms to do likewise. Thwarting special reviews is contrary to the profession's interests.

"We believe that our proposed restructuring will address many of Chairman Levitt's concerns and will effectively close the gap between 'independence in fact' and 'independence in appearance.' We are pleased that the chairman is endeavoring to be constructive in expediting our restructuring process.

"This is a new time and new era and the speed with which the world is changing demands that we move forward aggressively to enhance audit quality and consistency in a global business environment where our clients will soon require contemporaneous auditing, even internet-based auditing. The profession must institute the enhancements needed to ensure continued reliance and reliability. We applaud the chairman's call for further review, and intend to work side-by-side with him to create a regulatory scheme that meets the needs of today's economy."