Auditor Rotation: The PCAOB Considers a New Direction Academic Article uri icon

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abstract

  • SUMMARY The Public Company Accounting Oversight Board (PCAOB) recently undertook an exploration of the need for mandatory audit firm rotation with its issuance of the Concept Release on Auditor Independence and Auditor Rotation (PCAOB 2011a). The accumulation of evidence from PCAOB inspections of audit engagements over the last eight years has led the Board to consider additional steps to protect auditors' independence. We provide a brief synopsis of these matters based primarily on remarks by the PCAOB's chairman, James R. Doty (PCAOB 2011b, 2011c). In addition, we include relevant observations from prior academic studies and end with a call for the active participation of stakeholders in this important debate.

authors

  • Roush, Pamela B
  • Church, Bryan K
  • Jenkins, J Gregory
  • McCracken, Susan
  • Stanley, Jonathan D

publication date

  • December 1, 2011