Sec.  53.211   Audit planning.

   (a) Before selecting an independent auditor, the Bell operating company
   shall submit preliminary audit requirements, including the proposed scope of
   the audit and the extent of compliance and substantive testing, to the
   Federal/State joint audit team organized pursuant to  Sec. 53.209(d);

   (b) The Federal/State joint audit team shall review the preliminary audit
   requirements  to  determine  whether  it is adequate to meet the audit
   requirements in  Sec. 53.209 (b). The Federal/State joint audit shall have 30
   days to review the audit requirements and determine any modifications that
   shall be incorporated into the final audit requirements.

   (c) After the audit requirements have been approved by the Federal/State
   joint audit team, the Bell operating company shall engage within 30 days an
   independent auditor to conduct the biennial audit. In making its selection,
   the Bell operating company shall not engage any independent auditor who has
   been  instrumental  during  the past two years in designing any of the
   accounting or reporting systems under review in the biennial audit.

   (d)  The independent auditor selected by the Bell operating company to
   conduct the audit shall develop a detailed audit program based on the final
   audit requirements and submit it to the Federal/State joint audit team. The
   Federal/State  joint audit team shall have 30 days to review the audit
   program and determine any modifications that shall be incorporated into the
   final audit program.

   (e) During the course of the biennial audit, the independent auditor, among
   other things, shall:

   (1) Inform the Federal/State joint audit team of any revisions to the final
   audit program or to the scope of the audit.

   (2) Notify the Federal/State joint audit team of any meetings with the Bell
   operating company or its separate affiliate in which audit findings are
   discussed.

   (3)  Submit  to  the Chief, Enforcement Bureau, any accounting or rule
   interpretations necessary to complete the audit.

   [ 62 FR 2926 , Jan. 21, 1997, as amended at  67 FR 13226 , Mar. 21, 2002]