NCJ Number
69548
Date Published
1978
Length
227 pages
Annotation
This report contains the research, analysis, conclusions, and final recommendations of the commission on auditors' responsibilities, which focused on possible disparities between auditors' performances and public expectations.
Abstract
The commission based its conclusions on a series of research projects and reactions to a preliminary report by members of the American Insitute of Certified Accountants and Businessmen. Because the commission found that a gap exists between what the public expects and needs and what auditors can and should reasonably expect to accomplish, the report first examines the role of the auditor in society. Offering information which should help to narrow this gap, the report presents sections that discuss factors involved in evaluating financial presentations, reporting on significant uncertainties in statements, auditors' responsibilities for the detection of fraud, corporate accountability and the law, and ways to improve communications between auditors and users. The evolution of the auditors' role to accommodate changing business and investment needs is also covered. The examination of auditors' education and training describes the schism which has developed between practicing and academic accountants and has resulted in accounting firms having to spend considerable time and money training newly graduated accountants. Suggestions to improve the educational process include graduate programs and developing professional schools of accounting. Measures to help auditors maintain a necessary degree of independence are detailed and cover areas such as tax services, audit committees, and time pressures. The commission felt implementation of many recommendations would require new auditing standards or modification of existing criteria. The development of present standards is explored, followed by suggestions for changes in the standards-setting process. Finally, the report considers methods of regulating the profession to maintain the quality of audit practice. Summaries of the conclusions, recommendations, and research projects are provided. Significant changes from the commission's preliminary report are appended. An index is included. (Author Abstract Modified)