Auditor Independence Threats and Factors Affecting Independence

Abstract

In various professional standards and regulations, the accounting profession has generally described independence as a lack of specific interests and relationships that are presumed to affect auditor objectivity. An auditor must be watchful to any harmful impacts on his planning, investigation, or reporting to preserve independence under the numerous pressures from clients. This article reviews auditor independence literature and factors affecting independence in order to determine the effects of the factors on independence. The method employed for the research is a desk system of research design, in which data were collected through secondary sources such as journals, books and internet materials. The finding of the review indicates that the most mentioned threats to auditor independence are non-audit services, audit tenure, auditor-client relationship and client importance. Independence continues to be a problem when it comes to finding out how accurate and credible investor financial statements are. The leading factor of the independence of the auditor was not evident, but other researchers ranked them based on importance because of their belief that they chose to experiment.