But Bill Ezzell, chairman of the American Institute of Certified Public Accountants, warned against "cascading these changes" to private companies. And he cautioned investors not to read too much into every new detail disclosed by publicly traded companies under the new Sarbanes-Oxley law.

"Although there are things that are very appropriate about Sarbanes-Oxley for public companies, we're very concerned that there is not a knee-jerk reaction visited upon privately held companies," Mr. Ezzell said while visiting the Tennessee Society of CPAs during its three-day annual conference in Chattanooga. "We don't want to impose very costly rules upon companies without the appropriate level of benefit that we would see in publicly traded companies."

The American Institute of CPAs endorsed most of the new disclosure and independence requirements pushed through in legislation sponsored by Sen. Paul Sarbanes, D-Md., and Michael Oxley, R-Ohio, last year. The changes were adopted after auditors of the failed Enron, WorldCom and other corporate giants came under fire.

The new law restricts accounting firms from performing both auditing and consulting, requires officers to certify their financial results and mandates more information be disclosed to shareholders.

"These are positive steps that we supported," Mr. Ezzell said. "There may be some very good things that should apply more broadly, and we will. But we should understand how these work before we talk about expanding their scope."

Mr. Ezzell said the reputation of the accounting profession may have been soiled by high-profile auditing abuses. But interest in the profession has also grown on college campuses. "And it's important to remember that among nearly 17,000 publicly traded companies, we usually have 25 to 30 audit failures a year," Mr. Ezzell said. "The number was not necessarily that great. But the size of the companies involved certainly were."

Cleaning up from the fallout of Enron, WorldCom and similar bankruptcies is costing other companies, Mr. Ezzell said.

The cost of most audits for publicly traded companies has increased by more than 30 percent since Sarbanes-Oxley imposed more requirements on the reporting of financial results. Private companies without outside investors are not subject to most of the new requirements, although some state legislatures have considered laws to bring them under stricter standards.

Some of the new information also should be viewed with caution, Mr. Ezzell said.

For instance, companies disclosing information about complaints from whistleblowers within the company shouldn't necessarily trigger investor alarms.

"What we're going to learn over time is that probably 95 percent of those complaints are coming from disgruntled employees and it's not a real problem," Mr. Ezzell said. "People need to distinguish the wheat from the chaff."

At the association's 73rd annual meeting, Chattanooga accountant Ernie Baugh Jr. handed over the society's gavel to Knoxville accountant C. Gregory U Gilbert. But Another Chattanooga accountant, Hamilton County Finance Director Louis S. Wright, was elected vice president of the Tennessee Society of CPAs.

Mr. Wright has been a member of the society for more than 26 years and has served in various leadership positions at the chapter and state level.

-- Dave Flessner