Whistle-blowing by external auditors: Seeking legitimacy for the South African Audit Profession?

Warren Maroun and Jill Solomon

Accounting forum, 2014, vol. 38, issue 2, 109-121

Abstract: Auditing is often cited as playing an important role in managing agency-related costs and, accordingly, being integral to the sound functioning of capital markets. There may, however, be more to the attest function than a technical rational practice. By virtue of relying heavily on claims to technical expertise, professionalism, prudential judgement and public confidence, auditing is both a source of legitimacy for organisations and, paradoxically, dependent on claims to legitimacy for its continued existence. From this perspective, recent regulatory developments, purportedly enacted to increase arms-length control over the profession, may not only be about improving perceived audit quality and practice but also about ensuring continued faith in the well-established ‘rituals’ of the assurance function. A reporting duty imposed on South African external auditors, akin to whistle-blowing, is used as a case study to explore this perspective. In doing so, this paper contributes to the scant body of interpretive research on auditing, simultaneously offering one of the first insights into auditing regulation from an African perspective.

Keywords: Auditing; Arms-length regulation; Legitimacy; Reportable irregularity (RI); Section 45 of the Auditing Profession Act (the RI provisions); Whistle-blowing (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:accfor:v:38:y:2014:i:2:p:109-121

DOI: 10.1016/j.accfor.2013.04.007

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