The independence of the external auditor: a collective social construct

Abstract

The independence of the external auditor is a fundamental pillar of the quality of an audit alongside competence; it provides information on the auditor's actual ability to reveal in his audit report accounting errors or manipulations that would have a significant impact on the accounts. Independence is an old concept but has been the subject of a new impetus of interest with current corporate governance issues and financial scandals that have put external auditors back in the spotlight and prompted acute questions about the quality of auditing.

While competence seems to be an acquired element, the independence of the auditor remains easily questionable. The objective of our theoretical research work is to first present, through a literature review, a synthesis of the determining factors of the independence of the external auditor in this case the determinants related to the auditor and the audit firm, those relating to its relations with the audited company as well as the determinants related to external incentive mechanisms. These determinants form the basis of a system of independence that highlights direct and indirect actions between these different factors. In a second, we present the current of recent research in this field that apprehends the auditor’s independence as a psychological social construct where the independence is the result of his interaction with the different actors of his environment and the degree of cognitive moral development of the auditor. At the end of this synthesis, we will propose recommendations on research avenues in order to strengthen the independence of the external auditor in Morocco.

Keywords: Independence, external auditor, determinants, social construct

JEL Classification : M42

Paper type: Theoretical Research