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Audit Report



Thequestion of whether an engagement partner should be named in an auditreport is a simple one. The partner should not be named in the auditreport and I will endeavor to show why not. There are various reasonsupon which the Engagement Partner should not be named in an auditreport. Matters to do with the physical security, the privacy ofpartners and their families. On the other hand, the disclosure of theinformation has been regularized by the Public Company AccountingOversight Board. This is good as the users of financial statementswill be able to put a face to a name in the report. This would causethe partners to take seriously their engagements and improveperformance as partners whose work is satisfactory to the users maybe lauded in journals or publications. But to think that namingengagement partners will surely improve audit quality andaccountability from the respective firms might be a step too far.

Auditorsare bound by rules and regulations of their profession to offer theiropinion on financial statements as to the true and fair view of theaccounts. The naming of engagement partners would have the effect ofthe very opposite of this. The so named partner may come under undueinfluence from third parties in order to have the report portray acertain scenario which may not be the true and fair view of thecompany under audit. The partner named is exposed to the public forall and sundry to see. Accountability of the person while not namedis to the users of the financial statements, the client and tothemselves. With the naming of the partner, the responsibility to thethird party which is implied by nature of the engagement undertaken,becomes implicit for the partner as the secrecy that protects them istaken away, the auditor would now take into account how the thirdparty would intend to use the information provided that he or she maynot be held accountable for any losses that may occur. The doing ofthis would constitute a greater scope of responsibility to theauditor that was not there before. With the added responsibilitycomes the added risk to the auditor that need to be taken intoaccount.

Accordingto the Public Company Accounting Oversight Board, audit firms dependon reputation for them to get clients. Clients look at the previouswork of auditors in order to determine who to pick. Transparency isvery important in this regard and the naming of engagement partnerscomes in handy. A partner who gains a reputation for transparencywill have numerous clients lining up for him or her to serve them.However, with this in mind we have to take into account the secretivenature of major companies. The naming of the engagement partners forsuch firms would jeopardize the safety of the information of thecompany. Competitors will try by whatever means necessary to acquirethe sensitive information. This will cause a lot of complications.

Thenaming of engagement partners though crucial should be undertakenwith the utmost care. Security concerns, costs of audits and thescope and nature of audits should be taken into account. Namingengagement partners might improve the transparency and accountabilitybut at what cost. We should take into account the costs that willcome the naming of engagement partners.


Young,M. R.(2003) Financial ReportingHandbook. New York. AspenPublishers.

Wiley.(2012) focus Notes, Auditing andAttestation. Pennsylvania. JohnWiley &amp Sons.