Deloitte Touche Tohmatsu announced that it intends to separate Deloitte Consulting in response to public concern about auditor independence.

James Copeland Jr., CEO of Deloitte Touche Tohmatsu, said, “We came to this decision very reluctantly. I believe that, for our firm at least, the independence issue related to providing both auditing and consulting services is one of perception only. However, in the current environment, we cannot expose our clients to possible criticism because of the perception problem surrounding the scope of services audit firms may provide to clients.”

Doug McCracken, CEO of Deloitte Consulting, said, “We are acutely sensitive to the difficult independence questions faced by many of our clients. Therefore, we have decided to separate so that our clients can continue to benefit from the full depth and breadth of services we now offer.”

In a further effort to address public perceptions about auditor independence, Deloitte also announced it would no longer accept new engagements to perform internal audit outsourcing for audit clients.

“Deloitte Touche Tohmatsu continues to believe that effective auditing of large, complex organizations requires a team of professionals with skills in a wide variety of disciplines, such as information technology and security, actuarial science, capital market trading, and tax, in addition to accounting and auditing skills,” said Copeland. “Our decision to separate Deloitte Consulting will not affect our ability to ensure that our clients will continue to be served by teams that have all of the skills and experience necessary to provide them with the high-quality audits we have provided in the past.”