The role of auditors in the traditional setting is to express professional opinion on piece of account statements prepared by directors of a company. The essence is to rend credibility to the said statements, and that is where the problem lies. So many people have in the past questioned the relevance of accounting and auditing if corporate collapse that are in most cases directly linked to accounting and auditing scandals are still the order of the day.
It is ridiculous and hard to comprehend the rationale behind heavy expenses that companies make out of shareholders fund if absolute assurance cannot be given. Auditing professionals tell you that reasonable assurance is what the profession can give and not absolute assurance. Well, this may be what is obtainable now but, it is definitely not what is adequate in today’s business world that is so fragile and susceptible to shocks that is exacerbated by improved information processing technology.
If the mainstream definition of corporate governance in accounting and finance which is the collection of control mechanisms that protects shareholders interest is upheld, it then suffix that auditors roles must be increased so as to ensure the soundness of corporate governance that is grounded in good business ethic.
The hardest part of increasing the role of auditing and auditors in corporate governance is identifying what needs to be done and how it should be done. This is where this article comes into play. The remainder of this article is devoted to discussing how to increase the role of auditors in the overall control of businesses for the benefit of all.
How to increase the role of auditors in corporate governance of modern business