CharliePapaAlfa wrote: There's a cooling off period. Also the Enron/Arthur Andersen scandal happened because Arthur Andersen was providing both external audit services and management consulting services to Enron, which causes a self-audit risk. I don't know how they got away with this in the first place, but I'm guessing that it had to do with the vicious cycle of deregulation followed by reregulation that our economy and government seem to go through at least every 5-10 years.

Prior to SoX it wasn't illegal per se for a company to provide such services concurrently (though it was ethically questionable and the SEC and AICPA, among others, were beginning to raise questions about auditing firms pitching non-audit services). You have to remember that accounting firms providing consulting services to their audit clients was (and to some extent remains) a relatively new phenomenon. It wasn't really a matter of regulation/deregulation.