Discuss the arguments against and for mandatory audit firm rotation.© BrainMass Inc. brainmass.com October 2, 2020, 6:10 am ad1c9bdddf
Mandatory audit firm rotation is an attempt to increase audit quality by strengthening independence, a quality that is supposed to ensure high levels of skepticism and diligence in the face of estimates and difficult to audit areas. The arguments on both sides include:
Increase independence in appearance by external parties that rely on audit reports
Increase independence in fact by keeping auditor from getting "too close" to the client
Give the critical audit matters a 'fresh' technical face form time to time as a double check on the technical conclusions
Only rotating audit partners, and not the firm, ...
Discussion is 385 words plus a reference from PCAOB website. The opinion does not support firm rotation and indicates why not.