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The SEC requires all proposed audit and permitted

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non-audit services provided to the audit client and its

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subsidiaries to be pre-approved by the client’s Audit

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Committee. There are additional PCAOB pre-approval

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requirements for tax services and non-audit services related

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to internal control over financial reporting. In addition to

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requirements set by the SEC and the PCAOB, IESBA has new

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requirements to obtain concurrence from the Audit Committee

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prior to providing non-audit services to upstream entities

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that control a public interest entity audit client and

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downstream entities that the audit client controls,

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regardless of whether the controlled entity is consolidated.

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These incremental IESBA requirements most significantly

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impact private equity firms, registered investment

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companies, issuers that control investment advisers, and

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issuers controlled by an upstream parent that is not an

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issuer. In order for the Audit Committee to make an informed

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decision about a proposed service, we need to provide them

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with sufficient information about the service, to enable them

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to evaluate the potential effects on our independence.