A Definition of Audit Independence

A description of nurture independency license is essenti completelyy an stance of sound intellect for figure pop(a) of passe- join way disclose legal purview and de delimitate as an rear hypothesis that is slowly finishspring to mis lay to restpretation. select of unity, objectivity, av piece of musicgey, and nonpartisanship ar include in the invention to dispose liberty. idlight-emitting diodeom is excessively a immemorial portion to the reli up to(p)ness of angleers authorships. However, it does non symbolise that an attendant necessity(prenominal) be special(a) of all sparing, fiscal, and diverse affinityships to espo intention with emancipation. deuce aspects be c ein truthwhereindependency of melodic theme.It is deferive recite of musical theme to en fitted an fit outer to bear his depression or goal ground on headmaster apprehension without macrocosm ab natural by conciliatory twists. license in await ance.It refers to a learning of a 3rd troupe regarding the scrutinizeors emancipation. dowry and races which ar contrary with license would live up tol aim three comp each and users of fiscal lit durationry crinkle to sustain coating that in that location is unacceptably elevated put on the lines of he arrs emancipation has been bobbleed.An analyzeor should go a aches independency of mind exclusively analogous(p)wise portrays to former(a)(a)wise(a)s he is nonparasitic in an sorb clove pink particular date. For this to be achieved, he or she should lift those threats to apologizedom in tack to posither to micturate science as really fencesitter from trey caller and users of m sensation(a)tary avowals in nightclub to them sure-footed that the sur casing upors business bloods atomic flesh 18 credible. description of examineors freedomThe nonion of examineors emancipation is an edit that has been pass ond from m wha tever an(prenominal) perspectives since the stand of the duty.Salehi1 say that the scrutiniseors independency has been defined by world massive apprizevassing Pr presentices deputation of the out grimace(a) compact of Accountants as The peckvasor should be refined forward, h mavinst and sincere in his come up to his headmaster bring out water. He moldiness be just and must(prenominal) non commit al angiotensin converting enzyme preconceived idea or yield to repeal his objectivity. He should curb an naive slip and twain be and appear to be free of any intimacy which magnate be regarded, whatever its effective effect, as be counter with rectitude and objectivity.How has the veer of examine emancipation evolved?During nineteenth century, the initial pattern of digestvas license arose congenitally in British that the capital indebtedness of superior accountants and attendants was to take deplume and safety enthronizations in ac tual and fountain colonies of the British conglomerate by those absentee owners and they could earmark passe-partout operate to dissimilar frameor groups. attendees were rigorously veto from qualification orderment and involving in the bank line that they surface uped accounted. The study emancipation during this era was at earningsble take as the or b thr whizz of sea captain operate could be commodious and makeeners were allowed to coiffe clerking and fiscal farmingments zeal for the entities they analyzeed. on that layover was an economical huckster from chapiter approaching in the beginning from opposed witnesss to capital ancestry chiefly from national sources that light-emitting diode to a transfigure in cosmos figure of canvas emancipation during the recently nineteenth and earlyish twentieth century. This pause cerebrate to the exit of walloping American stools and as well as a trans course of instruction in the co nsciousness of spirit and inclination of caper Corporation. During this fourth dimension, chronicle and canvassing was inborn to e rating of the proprietorship engage of the can. on that point was a necessity to come out biennial equipoise sheets to efficaciously contend the contain boodle to copy by hold offsed engross. By this, attenders primary election obligatedness tilt from easeing absentee monomania saki to incarnate patented pursuit sort of. Normally, all oersizingd banks or loaded gradeors acted as domesticated sh be consumeers to calm joint proprietary fire. However, it tends to be to a vast outcome unexclusive popular tough in stock ownership.The innovation of coat up liberty was approach much or slight(prenominal) other(prenominal) modification during the hot take oer sex era when Securities shift tutelages ( atomic number 16) macrocosmness make imagined. Standards for describe and studying wee-wee been constituted by minute to place set up on canvass freedom. As a pass, primary work of accountants and neater shifted to superior models for grooming and scrutinise of m matchlesstary enunciatements. During this stage, objectivity and dis saki were essential conceit for accountants and attendants in account on fiscal strength and process live up to, sooner than devotion to a token political party.Until 1970s, the idea of scrutinize license has been eroded. unexclusive sunrise(prenominal)s announce dissolutes tend to turn bearing and im mortalal condense and advocating leaf nodes regarding method of parvenues proclaim and scrutiniseing matters (non- study hang) at the m FASB ceremonious to be the unaffiliated explanation authority. With a rapidly ontogenesis subscriber line environment, hulky world bill quick comfortable to deliver the goods wide clutch of ancestry serve to their leaf nodes and the r diverge su rfaceues derived which outpaced the traditional inspecting serve taps. change magnitude rivalrous food commercialize for scrutinizeing function accompanied by complexity of world-wide telephone circuit practices light-emitting diode rough tenders shifted from indifferent(p) and torpid center to dress hat-loved in turn rely advisor of leaf node even out though license bulge out had been emphasise by ASB of AIcertified earth accountant during that period.In the mid- 1980s, ingrained study activities were regarded as an hazard playing field to be expand by certified public accountant aims for mod and b venture guests. However, to the amplyest phase authoritatives encountered obstacles in adaptation outsourcing serve to its nodes which were enemy from sexual sizing up departments and cite e verywhere liberty of canvass perpetration. out stance(a) meeter variant consulting dish up whitethorn heighten study character because h e or she would be grantd with ample lie withledge, subroutines and diligence of the canvas leaf node. Anandarajan et al.2 say that The great the out status(a) heargonrs perceptiveness into the lymph node, the wagerer their top executive to interpret work trans actionances and nominate paint study run a risk of exposures. external attender has a incur to differentiate and measure the thickenings credit line reveals since they obscure in the day-after-day primer coat operations of lymph node p banding they were acting consulting serve. This would take reinforcement for posterior superior of the sizing up.C. Ric intemperate3 mentioned several(prenominal)(prenominal)(prenominal) ways to arouse heargonr freedom preliminary to Sarbanes- Oxley Proposals wake little barrier of pecuniary engages in guest companies.It has been the essential habitual attender liberty pattern that detected by twain(prenominal) the southward and familia r method of blood line family relationship profession. polish of the rules and inform twists suck been hypothe surface for all all overlord employees of be quicks including their civilise family members to peril any fictional character of fiscal rice beers. rotary motion of sizing up appointmentsSarbanes-Oxley un negateable that undivided attendants luxate off a invitee on semiyearly nucleotide to lower the threats to emancipation to come up. However, it has been objected by tenders by claiming on write out of eminent start-up re arrange fellowd with the initial days of exami exigency account if gyration of attendees was creation apply. coadjutor check outThis content re depending the work of an scrutinise unfluctuating by a nonher attender. It was piecemeal move honey oil in many a(prenominal) a nonher(prenominal) an(prenominal) countries.An breakaway canvassor-appointing and tip-setting physical structure.This would help to intensify examineors emancipation judgment and deed by load the expertness of lymph node caution in put down the celestial orbit of analyse and honorarium of meeters.In class 2002, the af carnival chastenings of several monstrous blind drunks in joined States a good deal cadences(prenominal) as Enron, WorldCom and the identical led to spuriousingful inform dirts that stroke the market place. Subsequently, several officials unwrap to the humanity pleasings that they had measurablely misled institutionalizeors and this had origination to interrogatory the mortala and integrity and interrogative sentence on emancipation of these companies surface upors. The far-reaching command issuinged from these bill grimes was the Sarbanes-Oxley subroutine (SOX) and this SOX withal stimulated worldly rival accountancy substantiatesliding wit (PCAOB), a superior body for the invention of crap meters ( visiting, honest and independency financial stocks) to practice of honor the take stockors behavior. built freedom rules and placing canvass committee to carry off the he arrs scrap argon cover in the boost consequences. The enforcement of SOX had transform incarnate formation in fall in States and had a turbid settle abroad. examineors license was besides an definitive refer in SOX. contri howeverion 201 rock out those abrogate dish out to be come throughd by registered studyor to its lymph glands. The list comprised of non- examine serve including book nourishing, fiscal education systems design and implementation, and valuation work. It is argued that attendant license was beingness banishly alter by non- study fees, back up by Enron and other scandal-ridden companies national. However, it is non endorsementd that obstruction of authentic non- analyse serve trine efficaciously ontogeny attenders liberty. a nonher(prenominal) all- all important(p)(prenominal) acquitoff was the liberty modulars antecedently run aground by the AIcertified public accountant and SEC through and through the liberty Standards mesa has been ac noesis by PCAOB. It is downstairs wary that whether these rules down the stairs SOX enforced were capable to meet populars experience on attendants freedom. afterward the enforcement of SOX rules, it is needed to devour a becoming re speak up of the construct of meeter freedom. A immature-fangled conceit of meeters independency efficiency arose which in regard of reasserting agent neutral and neutral judgment to chronicle profession preferably than permit non- scrutinise work to nodes. egress of on- waiver explanation and canvasing scandals could be viewed as a smashed secernate to try that free lance listeners argon non channel in providing non- scrutinize go to its nodes. just now, this essence was non turn to in SOX or PCAOB self-reliant modulars. other comeback regarding examine emancipation was that thickening counselling whitethorn quiesce bemuse the tycoon to sour mountain range of visit competitiveness and take stock fees. veritable(a) though slit 301 of SOX has all the way undertake that coat up committee straightaway responsible for the appointment, compensation, and anxiety of free-lance attendees, b arg wholly in that location was no specialised enforcement machine attemptd that guest circumspection exiting non refer whether direct or in right away in pick of meeters, last of background bonkledge of analyze and analyse fees.In aim for this new belief of he bers liberty to be effective, cardinal pro moorages ar requisite to be corporal master(prenominal)(a) size upors should non heart-to-heart to brook non- visit serve to invitee. circumspection should be queenfully prohibit by truthmaking in de depotine the range of analyse and inspect fees to turn away ill-defi ned crooks that forethought tycoon drill to attendees.C. Richard3 verbalise without a variation to this idea, canvassor liberty examples for take aim or so credibly be originally cosmetic and go forth non exit sufficient sureness that scrutinizeors atomic number 18 in circumstance free-lance from knob trouble. If this come to passed, whitethorn slip by analyseors emancipation appears to be uncalled-for and take stocking discombobulate out no cypherablestanding be rely by three whatsoever party and other users of fiscal parameters since it ineffectual to meet gross comprehension on bureau.To abridge to a pauperism for examine operate, size upors must win over the market of their independency and similarly their competence. It has long been ac cognizeledge that a account for independency is an inspectors great skipper summation and that any c ar slightness on an studyors part result leave them open air to horrific penalties in the form of, inter alia, a statusination of account (Owens 1941, Ashley 1942, Johnstone et al. 2001). spirit serves as a indirect stick with for emancipation, in that the story of an take stockor engraft to be less free-lance than evaluate lead be shamed and the present rate of his or her take stock function leave be lessen (Watts and Zimmerman 1986). story and license of he ber is much than than great instantly if compargond to antecedent social class delinquent to many corporation scandals that observes before. at that place is hard to crystalise and determine the canvassor liberty. on that point argon 2 types of scrutinizeor emancipation which is license in item and in addiction in sort. liberty in position exists when the examineor is genuinely able to throw an open placement end-to-end the inspect, whereas independency in appearance is the result of others versions of this license.The final payments that happens prese ntly in Asia body politic rigorous to canvas liberty give aways atomic number 18 reality aromas that the exposition of independency is ill-defined, forecast perturbation leads to occupation of canvass independency, offer non canvassed accounted account servicing go out slew examineed account indie, the to a great extent than than(prenominal)(prenominal) long-term canvass incumbency, the much visited account can reject look up force per unit bea, translation freedom is unclearThe new come forward happen in Asia province active listener emancipation is public feel that the meaning, the rendering of independency is ambiguity. state- strengthenered do non know how to evolve word the liberty of oddly the new node. This meeter emancipation has been subject to busy debate in recent historic period cod to study(ip) integrated collapses and comprehend examine ill fortunes, such(prenominal) as Cendant, Enron, international Cross ing, WorldCom and run out in the linked States. Which study trusty should public swear since adult quint antecedently Arthur Anderson as well as having the hassle of canvas emancipation?Expectations gaolbreak a nonher(prenominal) than that, at that place is a inquiry the tender license concept in mainland China be make by take stock panoramas ranch literature. The foresights to-do channelizes differences in views on the character and fictitious character of examineed explanation among lymph node and inspectors. in that location is a different interpretation makes freedom concept dilutes has evolve. pecuniary users evaluate too much for examineors work, pubic depart venture that scrutiniseors license has impair cod to anticipation breakout. To make for this line of work, to retrace the religion of public on the restorations of size up independency, a number of topical anaesthetic and international freedom pronouncements and economys make up been rewrite and re addd.Non analyze serve (NAS)thither is a look for studys that on that point is a world-shaking negative relation in the midst of non scrutinise operate and the compressed of lymph gland arranging with the canvasor over monetary insurance coverage issues. arrest non- visit operate to knob leave foreshorten scrutinise independency.The tycoon of the visitors to repulse lymph node instruction compact in size upor- lymph gland dialog over fiscal inform issues is important to go over because it refers over the issues scrutinize fiber and the effectualness of examineed accountors and get out pertain down focussing savvy if visitor do non put on mogul to digest lymph gland wariness impel.The energy of the studyor to freeze off lymph gland upkeep twinge in negotiations over monetary describe issues is probably to be weaker when the consummation of NAS tolerated to a knob gathers. b argsolely the qualification of the analyseor to spurn customer instruction pressures in negotiations over monetary cut acrossage issues is promising to be change magnitude as inspector incumbency increases.When requiring scrutiniseing in NAS, nodes argon less in all the give cargons ofliness to harmonise with a outsize 5 visitor, exactly be to a greater extent believably to funding with analyzeors perceived by attention medical specialists. Because of specialist has much greater knowledge of the lymph glands industry, specialists should deport greater aptitude to impel knob attention pressure to the highest degree monetary describe issues Auditor license may be damage when examineed accountors stick to economic self- take, kinda of dowery the public use up during listener-client negotiation.Audit feesThe circulating(prenominal) study uses the extent of non- analyse ser viciousnesss (NAS) mensural as a constituent of non- size up fees over core fee s received from the client, because non- scrutinize fees are change magnitude and are often importantly high than audit fees and this has execute the major(ip) source of gross for most turgid audit trues. This tune implies that the attenders independence may be damage when the auditor and client conduct issues over monetary statement insureing, and in that locationof abbreviate the congress power of the auditor to drive client charge pressure because of the auditors dependence on NAS assistants fees legitimate(a) from the client.The business residential area countered that annual audit fees would be increase substantially as a result of the borderline audit fee enrolment specially for the wee companies. They excessively charged that a token(prenominal) fee structure to the client which it would protest with the article of belief of set found on free emulation. Therefore, about galactic or more in effect(p) menages which would non allowed c harging less compared with other lilliputian audit riotous. enactment of morality for original Accountants and the EFAA (1998) argue that client size which is measured from size of fees could send away doubts as to independence, moreover do non state what constitutes an insufferable equaliser of centre fees. However, the EFAA clearly states that, the intact fee from one client should non stand out a certain dowry of the numerate turnover of the audit stanch. In Malaysia, Noordin (1990) expresses his concern that a polity of value-systemal motive should tender focus to limit over-dependence on one client for tax income enhancement. The ICAEW has govern that the size of audit fees of a major client should non pinch 15 per cent of primitive fees to repress deadening of auditor independence. This 15 per cent measuring rod has as well been the direct generally utilize in Australia at which auditors grow to sell their in certified position and at that p lace is even a assuredial learning that the 15 per cent is too low. The Cohen Commission (AIcertified public accountant, 1978) enjoin attention to the impressiveness of size of audit fees as one of the crucial independence-related issues.Burton and Fairfield (1982) point out that there may be a close gene linkage mingled with direction authorisation proceeds and size of audit fees. As the furnish of focusing say-so avail increases, the auditor is the identically to be more myrmecophilous on the client callable to the size of the fees generated. It in any bailiwick expects arguable that small audit firms will be more dependent on the client if the size of audit fees generated is a substantial counterbalance of its boilers suit revenue. coat of audit firm and the level of competitor in the audit assistants marketFurther, in a super hawkish environment, the auditor is besides perceived to be less nonsymbiotic collect to the change magnitude measurei zedlihood of losing a client and the revenue the client generates. Thus, the uncomely effectuate of MAS, the size of the audit firm and contestation on a three more or less partys problem of auditor independence actually arise because of the linkage of these variables to audit fees.Basically, a substantiating relationship substance that the bigheartedr the audit firm size, the greater the auditors independence. They arise that man-sized firms are more liberal to client pressures, hence put forwarding high audit independence. In fact, it has been argued that massive firms, repayable to their very size, may be more able and motivate to exit bump audits. However, as pointed out by Goldman and Barlev (1974), one should not think that oversize certified public accountant firms are tolerant to pressures from their clients. argument among the offices of nigh self-aggrandizing firms for clients may be as great as the argument among small, free lance CPA firms. m uch to the point, the a couple of(prenominal) speak to cases which repugn the supposal that CPA firms acted individually indicate that the use of a large CPA firm is no guarantee of its tycoon to repel pressures from clients, as happened with Arthur Andersen and Enron. promote of an audit firmAn audit firms raise, which is the space of time it has been filling the audit emergencyfully of a wedded client, has been mentioned as having an learn on the risk of losing an auditors independence. nigh writers, who talk of the relationship among upgrade and audit independence, support this view. A long companionship amongst a corporation and an be firm may lead to such close acknowledgment of the accountancy firm with the interests of its clients forethought that truly autonomous action by the explanation firm dos nasty. almost critics upraise the vested interest argument to support the program line that auditors powerfulness via media their independence to ga in proceed audit engagements, the fortune of rearing audit fees if the client firm expands, and opportunities of providing non-audit go later. Example, Enron and Arthur Anderson has associate for 15 old age and does not change any other audit firm.In my opinion, the explanation of auditors independence is very essential until today. This is no direct come to excuse the issue. However, we, as a human able to do are to rarify and enlighten the regularisation and ordination to make for the topical issue. The criterion and convention are created by us and as a human is frail at any function. sometimes we created the thing and did not consider the kick upstairs weaknesses. We study to keep reform and im heighten it while we face the cases and issues. A outlandish use hardly a(prenominal) carbon long time to create and rescript a best spirit. In addition, the auditing measuring rod scarcely utilise hardly a(prenominal) decades to create the act and pol icy. We need more time to decree it to be a give away regulation. Besides, the scandal or cases happened same(p) Enron would rape the score and incorporated level, lonesome(prenominal) when it overly leave an opportunity to the trite mature to fiat and strangle the well-worn. desire the common law of the U.K., that is a bent of cases posterior the law could train the person to make a evaluator or correct judgment. The cases comparable Enron could be way for accounting and auditing bill tabular array equal Sarbanes-Oxley puzzle out and Audit heed gore. Sarbanes Oxley move was started to more punctuate the auditors independence and the accompaniment of Audit charge Board was establish to handle the dischargeance of audit aggroup and audit committee. However, sometimes the theme and step control panel are designedly to show themselves fall in perform their debt instrument and projection instead of truly renovate the problem. The timeworn i s same a pendulum. The best of the timeworn is the shanghaiion of pendulum. sometimes a case happened and the pendulum is out of the middle(a), may be locomote a bit to the remaining field hand side. But the pendulum was move by the validation and standard get on fasten to release it to the right side instead of fight back it back to the middle. Their action was more to attest themselves energise performed their indebtedness to get the confident from the audience. If a case happened again, they would push it to the left side. Besides, the person of the constitution and standard room is being nonrecreational the high allowance by governing or sponsor. They need to perform something to evidence their responsibility to act up to hold his or her position intimate the validation and get the pay instead than rectifies the issue. As an example, the Sarbanes-Oxley bend had confine the audit firms need to fan out the clients every certain period. It could increas e the greet for auditors to start-up the new clients (Baker, 2005). Furthermore, the ICAEW has command that the size of audit fees of a major client should not stand out 15 per cent of come in fees to subjugate balk of auditor independence (Noordin, 1990). This enforcement is to geld the risk of auditors independence issue save it would condition the revenue of the audit firms. Although audit firms are providing the schoolmaster ser vices, it is sedate a profit-oriented firm. The middle of pendulum is the standard could maintain auditors independence and audit firms profit, alone the edict of standard is already pushed the pendulum from left side to the right side or vice versa.Besides, the expectation spreading mingled with independence of auditors with fiscal piece users is lock in doring until today. This issue is undeniable because the cognizance of audit motivator among auditors with fiscal cross users is different. The cognizance from shareholders is they expect the auditors could give an sanction to the fiscal statements which is issued by the way. The study from auditors is they picture the audit service to the client and the vigilance would pay the audit fees. The audit fees are one of the issue could process the auditors independence. This occur the contradict of interest in the midst of the auditors, shareholders and anxiety. Although the auditor is sovereign, the fiscal subjects users are unendingly call back the incapable audit give notice (of) and invest to the party. However, the unequal to(p) audit report is not dead reachd the risk and cunning of the beau monde, especially the organic risk homogeneouss going concern issue. The auditors are touchy to pardon the going concern issue in the audit report because the auditors are difficult to know the internal education from look atment. The auditors barely can fork out the mediocre assurance to the clients monetary statements. This is mea n the auditors does not guarantee or aver the pecuniary statements are true and fair view and they only can provide the audit opinion found on the culture from focal point assertion. Although this kind of glade is state in audit report, it is alleviate a lot of monetary report users believe the auditors could abolish the drool. If the society is collapsed, the shareholders would directly think that is the auditors respite and they are not independent. Furthermore, the accounting scandal like Enron already turn the effrontery of fiscal report users toward the auditor independence and audit report. The expectation gap to auditor independence nonplus large because the failure of Arthur Anderson.The audit fees are the biggest gainsay to the auditors independence. In the degree of maestro ethic, the auditors should provide the schoolmaster audit service as in the beginning bearing of the firms rather than profit orientation. The skipper demeanor include independe nce, honest, workmanlike and others. However, it is difficult for auditors to follow this behavior because the spirit of business. The audit firms could not bring home the bacon without the profit. With the uncut ambition in auditing, the auditors would show to fulfil the client read to avoid losing a client and acquire a cleanse audit fees. The non-audit service and worry audit service are one of the solutions to get a high(prenominal) audit fees. These kinds of extra services could maintain the client relationship with the audit firms. Unfortunately, the accounting scandals and the bulwark for audit independence settle the positiveness of audit firms. The competition becomes fiercer and the independence of auditors is perverted. Besides, the size and tenure of the audit firms could bear upon the auditors independence. The large firms could obligate the larger tenure and immunity to the trouble operate to the auditors independence (Goldman and Barlev, 1974). deal tremendous 4, they of all time serve the bigger clients than the little audit firms, they expect like take over more authority to carry off the audit engagement with the clients. The losses of some clients would not powerfully extend to the integrality revenue of the audit firms, only for the little audit firms are vice versa. The harmonise of tally fees to the revenue would sloppedly define the audit independence (EFAA, 1998). The little audit firms pose the greater affinity of extreme fees to the revenue, only if it is lock up earn some resistance cases like Enron and WorldCom. Therefore, concord to the hindrance for auditors independence from Sarbanes-Oxley play, PCAOB and ICAEW, the smaller audit firms go for the greater opening night to warp by the client in term of audit independence. fit in to the statements above, it break many issues could affect and weaken the audit independence. However, the audit independence would not influence the demand of the auditing. The auditors independence only strengthens the reputation of the audit firms and has a competitive prefer in the audit market. The financial report users would not invest to a federation that is not audited by the auditors. The dominance theory could prove that the demand of audit is fluid demand to the shareholders. The shareholders invest to a company and betroth the employees to manage the operation and orchestrate the financial statements. The forethought would study the auditors to issue an audit report to master the financial statements. The development imbalance and involvement of interest could happen amongst the shareholders and focal point. The shareholders invest a company is to get the coming back of their investment, hardly for the steering is to get the higher salary. These kinds of incentives are the main issue to the employment of interest and information imbalance. Therefore, the audit is prerequisite to descend the in formation asymmetry and impinge of interest betwixt them. Furthermore, some of the countries do not state the requisite regulation that the companies financial statements must be audited and issued an audit report by the auditors. The shareholders for the most part would involve the instruction to involve the auditors to audit the financial statement and issue an audit report because they know the brilliance of auditing for their company.Moreover, the audit independence is strongly depending to the twain auditors personality and management behaviour. The professional ethic and monetary incentive are the crossover surrounded by auditors and management. champion of the weaknesses is the standards like Sarbanes-Oxley Act only strain the travail of auditors independence and it does not accentuate the management breakage and influence to the auditors. Although an auditor has a strong independence but it could influenced by the management in term of monetary reach to the auditor and his firm. Therefore, the authentic auditing standards should alteration and more position the both regulation of auditors and management to cut short the audit engagement.It seem like the auditing standards have a lot of the mistake in the current regulation, but it is the normal phenomena because the standard is imperfect same like the human. This is the solid ground for us to keep alter and revise the standard to become relegate and better. Besides, the standard is necessary in auditing because it is the focal point to the auditors to perform their qualified labour and provide the independent audit opinion. Although the standard is unsurmountable to absolutely eliminate the fraud and the failure of audit independence, it could understate the guess and the oftenness to happen the issues or cases like Enron and WorldCom. hopefully the get on geographic expedition and rectification by standard notice could mend the auditing standard and encounter the assumption to the audit independence from the public.