Auditor Independence and NAS: A Comparative Analysis of Selected Current Regulatory Frameworks
Victoria University of Welington - School of Accounting and Commercial Law
A.K.M. Waresul Karim
Saint Mary's College of California - Graduate Business Programs
Tony van Zijl
Victoria University of Wellington - Faculty of Commerce and Administration
Working Paper No. 36
There is a widespread public perception that the provision of NAS undermines auditor independence. In order to protect auditor independence, the regulatory frameworks of many countries include regulations and guidelines which auditors are required to observe. This paper provides a comparative analysis of selected regulatory frameworks. Regulatory frameworks, with respect to independence, make distinctions between independence of mind and in appearance. It is clear from the analysis of the frameworks that the provision of NAS can threaten both inpendence of mind and in appearance. There are some NAS for which no safeguard seem to be adequate and which are therefore subject to prohibition. On the other hand, for some nonaudit services the threats are not so clearcut, and auditors are then required to apply professional judgment so that the seriousness of the threats is balanced against the effectiveness of specified safeguards.
Number of Pages in PDF File: 40
Date posted: April 26, 2012
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