When accountants start talking about getting innovative and radical, it's time to sit up.

And when the world's six biggest accounting firms join forces and publish a report that calls for, among other things, replacing quarterly financial statements with real-time Internet-based reports, relaxing auditor liability and subjecting all public companies to forensic audits on a random basis, you start to notice.

The report Global Capital Markets and the Global Economy has been put together by PricewaterhouseCoopers, KPMG, Ernst & Young, Deloitte, Grant Thornton and BDO.

You can hear a Marketplace Public Radio report here.

The report says it's time for change because the markets are now very different from what they were back the 1930s. First, the value of many companies now resides in "intangible" assets. But usually, any information valuing those assets is all over the place like a mad woman's breakfast. Secondly billions of people around the world can access information simultaneously but they have to wait until companies publish reports once a quarter, every six months or annually. And finally, information technology allows people to tailor the sort of information they're getting to suit their needs but financial reports still come out in a one-size-fits-all format which is not readily accessible.

And to remind us that the ghost of Arthur Andersen is still lurking in the background, the audit leaders suggest relaxing the rule of liability.

"Our firms are not and can never be the insurers of last resort for the capital markets, where capital flows each day are orders of magnitude larger than our combined capital bases, and where the market value of each of many large enterprises easily exceeds our combined capital by many times. A Regulatory and judicial system that clearly penalized those at fault rather than a system that inappropriately puts entire firms at risk would provide the proper incentives to discourage negligent or fraudulent audits without destroying the networks themselves."

Yeah, you gotta hand it to these guys. The stricter regulatory environment has turned into a bonanza for accounting firms but they want to hold on to their money when shareholders lose out. And their idea for restoring trust is to make it harder for shareholders to sue them. Hmm, there has to be a logical flaw there somewhere!

Anyway, to drive the message home, the six CEOs of the accounting signed an editorial in last Thursday's Wall Street Journal.

You can read the piece titled Caveat Auditor here.