An academic has called for the government to take the radical step of requiring listed companies to hire a second accounting firm to monitor the work of their auditor. Professor Ferdinand Gul, head of accountancy at City University, said it was needed to restore investor confidence. 'There have been so many accounting scandals in the United States and Hong Kong. The government needs to adopt a radical approach to reforming the industry,' Mr Gul said. He believed listed companies should be forced to set up an audit committee chaired by an independent non-executive director with experience in finance or accounting. The other committee members should also be independent and at least one or two should have a financial background. 'Companies should also appoint one or two senior auditors from another audit firm to sit on the committee. These outside auditors have the expertise and will be able to ensure the auditors are able to carry out their duties without fear of losing their clients,'' Mr Gul said. The audit committee should take over, from the company board, the job of deciding audit fees and appointing auditors, he said. This would also help remove auditors' fear of losing clients and fees. The professor's comments follow proposals by the Standing Committee on Company Law Reform for a range of measures to improve corporate governance, including a suggestion the rules be amended to force listed companies to rotate lead audit partners every five years. 'The proposal to rotate audit partners is definitely a move in the right direction. However, it is not going far enough to improve auditor independence,'' Mr Gul said. Patrick Yeung Kai-cheung, of CPA Australia's China and Hong Kong division, said Mr Gul's proposals might be too radical and expensive. 'I believe in evolution rather than revolution. The rotation of lead audit partners is a good suggestion and we should wait for this proposal to be implemented first,'' he said.