• In economics terms, an extensive knowledge of the client will enable the auditor to offer his or her services to his or her client in context which he/she already understands.
  • The auditor will not need to obtain large amount of background knowledge before conducting the other work.


  • The auditor will be perceived as not being fully independent
  • The auditor will in many cases be auditing his or her own work
  • Effectively much of this kind of other work involves management functions
  • Some of the work may effectively involve acting as and advocate for the client.

Should an auditor act as a tax adviser and negotiate on behalf of the client? The current situation is that most auditors do act in this capacity for their clients especially in the SME (small and medium sized) sector. Indeed many small companies see the auditor primarily as a tax negotiator and as an auditor only secondly. But should an auditor act in this way?

The dispute between the Big Four accounting firms and the SEC is a bitter one. Although it only relates to listed US companies, its resolution will have repercussions around the world. Part of the problem is the concentration of auditing of listed companies with a handful of giant accounting firms. This means that these firms are also the main suppliers on non-audit professional services, and the partners and staff of these firms have restricted opportunities for investment if they cannot invest in their client companies. This topic has received additional attention recently in the USA and UK as a result of the Enron scandal and Anderson’s.