independence

The absence of a relationship, obligation, or *conflict of interest that could comprise an auditor’s judgment. In external auditing, independence can be subverted (or can be perceived to be subverted) by many factors, including the following: (i) a financial interest in an *auditee’s business or in an audited transaction; (ii) family or personal relationships with *auditees; (iii) excessive entertaining or hospitality by or with auditees; (iv) lavish *gifts to and from auditees; (v) restrictions on the scope of audit work; (vi) an auditor’s overdependence on fees from one customer; and (possibly) (vii) the provision of lucrative *management advisory services. In addition to these aspects of independence, most of which are manifestations of potential conflicts of interest, the concept is often discussed in terms of a state of mind, involving personal character, ethics, and honesty. Therefore, while it has been suggested that auditing "requires a high level of technical knowledge, integrity, and interpersonal skills" (Beattie et al., 2001, 285, emphasis added), it has also been argued that independence "is an attitude of mind which goes deeper than any formal rules or standards" (Newman, 1964, 148). It is little wonder that Lee (1993, 100) refers to auditor independence as a "multi-dimensional concept." Independence is considered to be essential for an objective, unbiased external *audit opinion: "It is primarily on the basis of its independence that the external audit derives its authority and its acceptance" (Flint, 1988, 29). Or, expressed more evocatively, "the auditor, like Caesar’s wife, must be above suspicion" (Toffler and Reingold, 2003, 251). Further reading: AICPA (1997); Caswell (1999); Mutchler et al. (2001); Stevenson (2002); Windsor and Ashkenasy (1995); Youkins (1983)

Auditor's dictionary. 2014.

Synonyms:

Look at other dictionaries:

  • Independence — Independence, MO U.S. city in Missouri Population (2000): 113288 Housing Units (2000): 50213 Land area (2000): 78.328220 sq. miles (202.869151 sq. km) Water area (2000): 0.126088 sq. miles (0.326566 sq. km) Total area (2000): 78.454308 sq. miles… …   StarDict's U.S. Gazetteer Places

  • Independence — (eng. Unabhängigkeit) steht für Independence (Zigarren), Zigarrenmarke USS Independence, Schiffe der US Navy Independence (1951), Linienschiff für die Hochseeschifffahrt Orte in den Vereinigten Staaten: Independence (Alabama) Independence (Iowa)… …   Deutsch Wikipedia

  • Independence — puede referirse a: Independence, álbum del grupo Sex Museum Independence Day, película de 1996 Independence Hall, monumento nacional de Estados Unidos USS Independence, nombre de diversos buques estadounidenses Lugares Independence (Alabama)… …   Wikipedia Español

  • Independence — is the self government of a nation, country, or state by its residents and population, or some portion thereof, generally exercising sovereignty. The term independence is used in contrast to subjugation, which refers to a region as a territory… …   Wikipedia

  • independence — UK US /ˌɪndɪˈpendəns/ noun [U] ► POLITICS freedom to make laws or decisions without being governed or controlled by another country, organization, etc.: gain/win/declare independence »The country gained its independence in 1991.… …   Financial and business terms

  • Independence — In de*pend ence, n. [Cf. F. ind[ e]pendance.] [1913 Webster] 1. The state or quality of being independent; freedom from dependence; exemption from reliance on, or control by, others; self subsistence or maintenance; direction of one s own affairs …   The Collaborative International Dictionary of English

  • Independence, CA — U.S. Census Designated Place in California Population (2000): 574 Housing Units (2000): 342 Land area (2000): 3.997508 sq. miles (10.353498 sq. km) Water area (2000): 0.000000 sq. miles (0.000000 sq. km) Total area (2000): 3.997508 sq. miles… …   StarDict's U.S. Gazetteer Places

  • Independence, IA — U.S. city in Iowa Population (2000): 6014 Housing Units (2000): 2610 Land area (2000): 3.708116 sq. miles (9.603975 sq. km) Water area (2000): 0.134959 sq. miles (0.349542 sq. km) Total area (2000): 3.843075 sq. miles (9.953517 sq. km) FIPS code …   StarDict's U.S. Gazetteer Places

  • Independence, KS — U.S. city in Kansas Population (2000): 9846 Housing Units (2000): 4747 Land area (2000): 4.974332 sq. miles (12.883459 sq. km) Water area (2000): 0.000000 sq. miles (0.000000 sq. km) Total area (2000): 4.974332 sq. miles (12.883459 sq. km) FIPS… …   StarDict's U.S. Gazetteer Places

  • Independence, KY — U.S. city in Kentucky Population (2000): 14982 Housing Units (2000): 5391 Land area (2000): 16.772507 sq. miles (43.440592 sq. km) Water area (2000): 0.006417 sq. miles (0.016619 sq. km) Total area (2000): 16.778924 sq. miles (43.457211 sq. km)… …   StarDict's U.S. Gazetteer Places

  • Independence, LA — U.S. town in Louisiana Population (2000): 1724 Housing Units (2000): 735 Land area (2000): 2.231891 sq. miles (5.780571 sq. km) Water area (2000): 0.001764 sq. miles (0.004570 sq. km) Total area (2000): 2.233655 sq. miles (5.785141 sq. km) FIPS… …   StarDict's U.S. Gazetteer Places

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”

We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.