[...]... observed that there have been significant changes in the concept of auditor independence over the past 150 years The initial concept of auditor independence, which prevailed during the latter part of the 19th century, focused on the accounting profession’s belief that Independent Accounts: The Possibilities for Auditor Independence in the Age of Financial Scandal Advances in Public Interest Accounting, Volume... together academics from across the globe to consider the issue of auditor independence in different jurisdictions and provide suggestions on how to move forward These chapters set out the Auditor and Audit Independence in an Age of Financial Scandals 9 commonalities and differences on the issue of auditor independence across countries, providing the starting point for answering what is the problem of auditor. .. the scandals of 2002 and the enactment of the Sarbanes-Oxley Act, which modifies the concept of auditor independence once again towards the concept of protecting the interests of investors and creditors in capital markets DEBATES ABOUT AUDITOR INDEPENDENCE During the last half of 20th century, there were numerous debates over auditor independence in both academic and professional literatures In these... level acceptable to the auditor In the language of economics, the auditor will perform audit work until the cost of undertaking more work is equal to the benefit the auditor derives in terms of the reduction in the risk of a successful lawsuit being possible This then represents the minimum amount of work that the reader can expect the auditor to perform However, all auditors are individuals with different... Special Issue, the paper makes some brief comments about possible solutions to the problem of independence of audits and suggests a focus on audit, not auditor, independence Independent Accounts: The Possibilities for Auditor Independence in the Age of Financial Scandal Advances in Public Interest Accounting, Volume 12, 1–15 Copyright r 2007 by Elsevier Ltd All rights of reproduction in any form reserved... accounting information efficiently and the intangible benefits of state and other forms of regulation More importantly, most accounting research is wedded to a partisan view that the value of accounting and auditing should only be judged according to the interests of investors and suppliers of capital (Cooper & Sherer, 1984) THE THEATER OF FINANCIAL SCANDAL The theater of corporate executives being charged,... financial interests in client companies – A legal prohibition against an auditor possessing financial interests in a client company has been the cornerstone of auditor independence in the United The Contested Concept of Auditor Independence 23 States since the 1930s Through the 1990s, this was not true in the United Kingdom and certain other countries, even though prohibitions against holding financial interests... training of auditors and suggest the need to move such training back into universities and away from internal programs run by the audit firms or professional bodies Other contributions remind us of the need to consider the economic context of audit This includes the economic impact of a client on the firm as a whole, and the impact of losing a specific client on the reputation and income of individual auditors... independent, using independence to mean ‘an attitude of mind which does not allow the viewpoints and conclusions of its possessor to become reliant on or subordinate to the in uence and pressures of conflicting interests’’ (p 89) While this quote reflects the tenor of the debates surrounding the concept of auditor independence, Lee’s rhetorical expression avoids the fact that an auditor s state of mind... experience bring into sharp focus the differences and similarities between the North American and Eastern European contexts Their in- depth analysis and research show that while auditors formally comply with the appropriate laws (often deriving from the International Federation of Accountants proposals for independence) , the real issue of independence is in the economic context: obtaining and retaining clients, . focus on audit, not auditor, inde- pendence. Independent Accounts: The Possibilities for Auditor Independence in the Age of Financial Scandal Advances in Public Interest Accounting, Volume 12, 1–15 Copyright. Fit? ADVANCES IN PUBLIC INTEREST ACCOUNTING VOLUME 12 INDEPENDENT ACCOUNTS: THE POSSIBILITIES FOR AUDITOR INDEPENDENCE IN THE AGE OF FINANCIAL SCANDAL EDITED BY CHERYL R. LEHMAN Hofstra University,. w1 h0" alt="" INDEPENDENT ACCOUNTS: THE POSSIBILITIES FOR AUDITOR INDEPENDENCE IN THE AGE OF FINANCIAL SCANDAL ADVANCES IN PUBLIC INTEREST ACCOUNTING Series Editor: Cheryl R. Lehman Volume 1: