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The purpose of this paper is to investigate the effect that a regime of mandatory audit firm rotation would have on audit quality.

Using two measures of audit quality, being the propensity to issue a going‐concern report and the level of discretionary accruals, the paper examines the switching patterns of clients in their current voluntary switching capacity, and the levels of audit quality.

The main finding is that audit quality increases with audit firm tenure, when proxied by the propensity to issue a going‐concern opinion, and is unaffected when proxied by the level of discretionary expenses. Given the additional costs associated with switching auditors, it is concluded that there are minimal, if any, benefits of mandatory audit firm rotation.

A limitation of this study is that only actual audit quality is examined. While the results suggest that actual audit quality is associated with the length of audit tenure, the perception of audit quality is not addressed, which may increase with audit firm rotation.

The results go against the move towards mandatory audit firm rotation, and suggest that other initiatives may need to be considered to address concerns about auditor independence and audit quality.

This article describes the process of producing ISO 15489 Records Management, and explores some of the professional and other issues that arose for consideration at an international level. It concludes by identifying some of the benefits of the Standard for records management in the UK.

Over the past 20 years, external auditing activities and practices in Vietnam have developed quickly. An important milestone is the first Law on External Audit No. 67/2011/QH12 which has been passed by the National Assembly of Vietnam on 29 March 2011. The purpose of this paper is to understand the perceived motivations in regard to the introduction of the Law on External Audit, through the eyes of various key stakeholders. There has been genuine public interest concerns regarding audit quality in Vietnam as prior academic research has indicated, and this is the first study to examine whether the new audit reforms where introduced specifically to deal with those concerns.

Face-to-face semi-structured interviews were conducted with 45 key stakeholders during 2014 in both Ha Noi and Ho Chi Minh City, Vietnam.

The study finds that the Law on External Audit was introduced because it holds the highest form of regulatory authority in Vietnam, and the lower level Decrees that existed before the law did not even detail the audit firms’ responsibilities resulting in low audit quality. Also, the new Law was introduced to add more credibility and trust in the external audit function in Vietnam, and to reduce unfair price competition. However, some of our findings indicate that the Governments’ motivations were not all purely public interest related. A theoretical framework is developed to evaluate whether these reforms are substantive enough in nature to effect public confidence in reported financial data and audits.

External auditing plays a crucial role in any market-based economy. In a developing economy, audit quality is often perceived to be lower than in a developed economy. Therefore, it is not uncommon to observe governments in developing economies producing tighter regulations for the auditing and assurance market to help attract more foreign investment and to establish credibility and more trust. In Vietnamese context, the current study conveys that the new audit reforms not only were introduced with genuine public interest concerns but also were a mechanism to protect the government’s interests.

This study aims to address an acknowledged gap in the literature for the analysis of experienced practitioner views on the effects and implications of mandatory audit firm rotation (MAFR).

Using an exploratory and sequential design, data was collected from South African regulatory policy documents, organisational comment letters and semi-structured interviews of practitioners. These findings informed a field survey, administered to auditors, investors, chief financial officers (CFOs) and audit committee members of Johannesburg Stock Exchange (JSE) listed companies.

Practitioners expressed considerable pushback against the potential efficacy of MAFR to improve audit quality due to various “switching costs”, notably the loss of client-specific knowledge and expertise upon rotation. In addition, the cost and disruption to both the client and audit firm are considered significant and unnecessary, compared to audit partner rotation. The audit industry may suffer reduced profitability and increased strain on partners, leading to a decline in the appeal of the profession as a career of choice. This is likely to have negative implications for audit industry diversity objectives. Furthermore, the industry may become more supplier-concentrated amongst the Big 4 firms.

The findings have policy implications for regulators deciding whether to adopt the regulation, as well as guiding the design of policies and procedures to mitigate the negative effects of adoption.

The participants are experienced with diverse roles concerning the use, preparation and audit of financial statements of large exchange-listed multinational companies, as well as engagement in the auditor appointment process. The extant literature presents mixed results on the link between MAFR and audit quality, with most studies relying on archival and experimental designs. These have a limited ability to identify and critique the potential’s witching costs and unintended consequences of the regulation. Experienced participants responsible for decision-making within the audit, audit oversight and auditor appointment process, are best suited to provide perspective on these effects, contrasted against the audit regulator’s position.