Independence in Financial Audit Engagements. The Case of Romanian Banks
For the external audit to ensure the credibility of the financial statements, it is a mandatory and vital requirement to maintain the independence in audit engagements. In practice, when performing the audit engagements there are various threats to independence, such as the non-audit services, the f...
| Format: | Article |
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| Language: | English |
| Published: |
Chamber of Financial Auditors of Romania
2020-01-01
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| Series: | Audit Financiar |
| Subjects: | |
| Online Access: |
http://revista.cafr.ro/temp/Article_9629.pdf
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| _version_ | 1818287345788518400 |
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| collection | DOAJ |
| description | For the external audit to ensure the credibility of the financial statements, it is a mandatory and vital requirement to maintain the independence in audit engagements. In practice, when performing the audit engagements there are various threats to independence, such as the non-audit services, the financial dependence of the auditor on its client, and the familiarity between client and auditor. The risk they pose to independence may be diminished through the rotation policy of the partner and audit firm. The rotation (voluntary or compulsory of the partner or audit firm) generates, according to the professional literature, both advantages and disadvantages, the legal practices and regulations being different from one country to another. Although the Romanian legislation does not require the rotation within the audit engagements, we believe that adopting these practices is an indication of maintaining independence and conducting a quality audit. Starting from this aspect, our research aims at the rotation practices of the banking institutions operating on the Romanian market. The results show that most banks adopt their own rotation policy of the partner and audit firm. This research may be useful to interest-holders within the banking system, as well as to the regulatory bodies in Romania. |
| first_indexed | 2024-12-13T01:39:01Z |
| format | Article |
| id | doaj.art-5b072e3f50a44706bc49d1fe7f94cfc1 |
| institution | Directory Open Access Journal |
| issn | 1844-8801 |
| language | English |
| last_indexed | 2024-12-13T01:39:01Z |
| publishDate | 2020-01-01 |
| publisher | Chamber of Financial Auditors of Romania |
| record_format | Article |
| series | Audit Financiar |
| spelling | doaj.art-5b072e3f50a44706bc49d1fe7f94cfc12022-12-22T00:03:49ZengChamber of Financial Auditors of RomaniaAudit Financiar1844-88012020-01-011815711312710.20869/AUDITF/2020/157/1139629Independence in Financial Audit Engagements. The Case of Romanian BanksFor the external audit to ensure the credibility of the financial statements, it is a mandatory and vital requirement to maintain the independence in audit engagements. In practice, when performing the audit engagements there are various threats to independence, such as the non-audit services, the financial dependence of the auditor on its client, and the familiarity between client and auditor. The risk they pose to independence may be diminished through the rotation policy of the partner and audit firm. The rotation (voluntary or compulsory of the partner or audit firm) generates, according to the professional literature, both advantages and disadvantages, the legal practices and regulations being different from one country to another. Although the Romanian legislation does not require the rotation within the audit engagements, we believe that adopting these practices is an indication of maintaining independence and conducting a quality audit. Starting from this aspect, our research aims at the rotation practices of the banking institutions operating on the Romanian market. The results show that most banks adopt their own rotation policy of the partner and audit firm. This research may be useful to interest-holders within the banking system, as well as to the regulatory bodies in Romania. http://revista.cafr.ro/temp/Article_9629.pdf external audit; independence; rotation of the audit partner; rotation of the audit firm; the banks from romania |
| spellingShingle | Independence in Financial Audit Engagements. The Case of Romanian Banks Audit Financiar external audit; independence; rotation of the audit partner; rotation of the audit firm; the banks from romania |
| title | Independence in Financial Audit Engagements. The Case of Romanian Banks |
| title_full | Independence in Financial Audit Engagements. The Case of Romanian Banks |
| title_fullStr | Independence in Financial Audit Engagements. The Case of Romanian Banks |
| title_full_unstemmed | Independence in Financial Audit Engagements. The Case of Romanian Banks |
| title_short | Independence in Financial Audit Engagements. The Case of Romanian Banks |
| title_sort | independence in financial audit engagements the case of romanian banks |
| topic | external audit; independence; rotation of the audit partner; rotation of the audit firm; the banks from romania |
| url |
http://revista.cafr.ro/temp/Article_9629.pdf
|