Auditing and Accounting Ethics Essay Example | Topics and Well Written Essays - 4250 words

Auditing and Accounting Ethics - Essay ExampleThe fiddle suggests proletariat continuous rotation of audit partners. It also emphasises increased financial reporting and imposes limits on certain non-audit services. The Sarbanes-Oxley act suggests reducing the economic interdependence of auditor and client. The economic rent provided to the auditors can only be gained as a result of long lasting relation ship between the auditor and the client, this condition in turn acts as a hindrance in the way of auditor to act independently. The threat of lawsuits oftentimes act as a motivator for the auditors to act independently as inefficient or dirty performance can result in shape of judicial action against auditors. In most of the studies undertaken it has been observe that the higher degree of threat to the auditors independence leads to authentic opinion. Its also found that auditor does not extend to change their decision with the varying degree of independence but change the deci sion process. i) Difference in the social and cultural values Standard setting is a crucial process, which includes change. Some societies have feed and flexible culture, which keeps on transforming with the time. But on the other hand closed societies have relatively hardened culture. The acceptance level of change in these societies is very low. In the case of the global harmonisation of standards a country adopting the International standards cannot complete the picture. In most of the studies undertaken it has been observed that the higher degree of threat to the auditors independence.