Is audit failing the global capital markets?

Early attention was given to the role of several ‘gatekeepers’ in enabling, or failing to mitigate, the global financial crisis but it is only more recently that the role of auditors has started to be given concerted attention by some commentators. The entrenched privileges of auditors, associated with the mandatory audit requirement which can only be fulfilled by members of the profession, requires us to ask whether the balance between serving the public and the auditors’ own interests is correctly calibrated. While it is understandable that accountancy and auditing are inextricably linked, it would be better for the global economy if the auditing profession were to cut its umbilical cord connecting it to accountancy. This article also suggests that neither have internal auditors, as one of the ‘gatekeepers’, been blameless for the global financial crisis although they have emerged largely unscathed. The price they have paid is that so far they are not perceived as being a significant part of the solution going forward.