The Impact of Auditor’s Tenure on Quality Audit Report

Abstract

This research work considers the impact of Auditor’s tenure on quality of audit report. There have been divergent views from previous researchers.  On one hand, the first school of thought is of the view that as the tenures of the auditors become longer, they gain expertise of the businesses of their clients and therefore, their ability to detect fraud increases; conversely, the ability of the manager to commit fraud reduces. On the other hand, the contrary view is that long audit tenureship may bring about increased familiarity between the auditor and the managers. Consequently, the auditor may become more sympathetic with the management. This may in turn reduce the readiness of the auditor to qualify his report; and therefore increasing the client’s fraud incentives. The impact of auditor’s tenure on quality of audit report depends on his ability or the level of his independence. The contributions of previous researchers were accessed. The study suggests ; a period of one to three years as an ideal audit tenure, regular change of audit team (where necessary), review of statutory and professional provisions etc.

Keywords; Auditors Tenure, Fraud, Audit Report and Auditor’s Independence.