Ethics and Governance: Auditor Independence
William Robertson
Keiser University
Dr. Bunney Schmidt
Survey of Accounting
March 16, 2013

MAI-57 Ethics and Governance: Auditor Independence
Consulting fees can affect audit independence by causing auditors to sway their decision making due to the monetary income. Audit independence is based on an agencies ability to make hard but sound observations of a company’s financial conditions (Easton, et al, 28). Payment for such services has gain debatable opposition on their ability to stay focused on the job. If a consulting or auditing agency charges fees for their service, this becomes an important source of income. The larger the fees or contract, the less likely a consulting or auditing agency would stand against or make known, the company they audit, misstatements on their financial documents (Easton, et al, 29). Basically, an indirect form of bribery may ensue if large fees are applied, and could be a threat of going away if a negative audit results.
Bribery brings up other conflicts of interest. Many conflicts could arise. The auditing representative could have financial interest in stock and shares of the audited organization. The auditing representative could have some biasness toward the organizations such as a friendly relationship or the complete opposite. Internal auditing tends to face this issue of biased auditing. The auditing or consulting agency could experience a greater fear