The Definition Of Auditor Independence

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The term audit is being used with increased repetition and not just in the financial sector but also in education, medicine and environment among other issues. Audit tries to deliver higher accountability, precision and standards to the users of financial standards, especially since the separation between ownership and management had occurred in the 19th century, and with it the need of the stakeholders of being assured that their investments are in reliable hands. A definition of audit is given by Crawford et al and it signalises the expectation of the users regarding the audit report. Concepts as ’transparency’ and ’independence’ are not easy to define and put in practice, transparency referring not only to the audit statements but also …show more content…

One of the independence concepts, formulated by Mautz and Sharaf deals with practitioner independence, which has three branches: programming, investigative and reporting independence. The first one deals with the auditor’s liberty in choosing the features and the terms of reference of the audit strategy and methods without exterior intrusion, the second deals with the admission of the auditor to all information regarding the company. Last, the auditor must be independent from external authority and influence in order to form assessments and judgements. The practitioner independence fused with the absence of influence is defined as professional independence; it also signifies a lack in self-interest when making objective opinions. Audit independence may be in danger if the auditor is perceived as deliberately benefitting the auditee’s well-being, this might happen because the auditor is attracted to a financial recompense or because of the close relationship between the auditor and the company or auditee or because of the consulting services. Whatever the case, the auditor and the auditing profession has to construct and nourish a favourable public opinion in the independence and truthfulness of the audit profession, if the organisation is to seen as

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