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The future of auditing: the debate in the UK

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  • David Hatherly

Abstract

Upon its creation in 1991, the UK's Auditing Practices Board (APB) debated the future of financial statement auditing, leading to a succession of APB publications in 1992, 1994 and 1996. A significant theme of these publications focused on the need for an audit environment in which auditing can be sustained as a professional judgement, in the face of pressures tending to subvert the audit into a process of compliance with rules. This paper articulates an 'accountability model' of the audit, developed as a consequence of APB's debate and underpinning many of the policy implications of the APB papers. This model is articulated in terms of the concepts of lateral and hierarchical accountability. The fear that judgement would be displaced from auditing has for the moment proved groundless given the recent introduction of new judgemental audit methodologies based on an assessment of business risks. Nevertheless, it is argued that the underlying accountability model and its implied imbalance between the hierarchical and lateral accountabilities of the audit engagement partner, still stands.

Suggested Citation

  • David Hatherly, 1999. "The future of auditing: the debate in the UK," European Accounting Review, Taylor & Francis Journals, vol. 8(1), pages 51-65.
    • Handle: RePEc:taf:euract:v:8:y:1999:i:1:p:51-65
    DOI: 10.1080/096381899336140
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    References listed on IDEAS

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    1. Dirsmith, Mark W. & Heian, James B. & Covaleski, Mark A., 1997. "Structure and agency in an institutionalized setting: The application and social transformation of control in the Big Six," Accounting, Organizations and Society, Elsevier, vol. 22(1), pages 1-27, January.
    2. David Hatherly, 1995. "The case for the shareholder panel in the UK," European Accounting Review, Taylor & Francis Journals, vol. 4(3), pages 535-554.
    3. Tsui, Judy S. L. & Gul, Ferdinand A., 1996. "Auditors' behaviour in an audit conflict situation: A research note on the role of locus of control and ethical reasoning," Accounting, Organizations and Society, Elsevier, vol. 21(1), pages 41-51, January.
    4. Francis, Jere R., 1994. "Auditing, hermeneutics, and subjectivity," Accounting, Organizations and Society, Elsevier, vol. 19(3), pages 235-269, April.
    5. Carpenter, Brian W. & Dirsmith, Mark W. & Gupta, Parveen P., 1994. "Materiality judgments and audit firm culture: Social-behavioral and political perspectives," Accounting, Organizations and Society, Elsevier, vol. 19(4-5), pages 355-380.
    6. Kim Klarskov Jeppesen, 1998. "Reinventing auditing, redefining consulting and independence," European Accounting Review, Taylor & Francis Journals, vol. 7(3), pages 517-539.
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    Cited by:

    1. Olivier Herrbach, 2001. "Audit quality, auditor behaviour and the psychological contract," European Accounting Review, Taylor & Francis Journals, vol. 10(4), pages 787-802.
    2. Alia Miledi & Benoit Pigé, 2013. "Le Jugement Professionnel En Audit : Enquete Aupres Des Associes Signataires," Post-Print hal-01002359, HAL.
    3. Anca Oana CHIȘ & Andra Maria ACHIM, 2014. "Professional Judgement. The Key To A Successful Audit," SEA - Practical Application of Science, Romanian Foundation for Business Intelligence, Editorial Department, issue 5, pages 217-222, November.
    4. Ines Gaddour, 2013. "Contribution A L'Étude Des Comportements Dysfonctionnels Des Auditeurs Seniors : Une Approche Managériale (Le Cas Français)," Post-Print hal-01002376, HAL.
    5. repec:dau:papers:123456789/13774 is not listed on IDEAS
    6. Alia Miledi, 2012. "Replacer L'Auditeur Au Coeur De Son Metier: Une Etude Exploratoire Sur Le Marche Français," Post-Print hal-00937912, HAL.

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