Skip main navigation

Compulsory periodic rotation of engagement partner

Men looking up with his arms extended on each side

Compulsory periodic rotation of engagement partner

Increases auditor independence which addresses the deficient performance component of the AEG.

Arguments for

  • Compulsory rotation of audit firms would help reduce the AEG, due to its positive effect on auditor independence

Arguments against

  • Auditor rotation increases cost and time involved in completing an audit while reducing audit quality.
  • Additional time and effort is required by the incoming partner to familiarise themselves with the client’s business
  • Also, the lack of prior experience may affect incoming audit partners judgments, reducing audit quality

Over to you

Do you agree with these arguments? Why?

This article is from the free online

Accounting for Today’s Dynamic World

Created by
FutureLearn - Learning For Life

Reach your personal and professional goals

Unlock access to hundreds of expert online courses and degrees from top universities and educators to gain accredited qualifications and professional CV-building certificates.

Join over 18 million learners to launch, switch or build upon your career, all at your own pace, across a wide range of topic areas.

Start Learning now