Explain connection between the issue(A suggested ban on audit firms Essay

Explain connection between the issue(A suggested ban on audit firms providing non-audit services)and confidence in the role of a - Essay Example Al., 1999). It can be recognised from the above description that the roles and responsibilities of an auditor are concentrated on the execution of the auditing process including the ethical aspect of independence. However, certain real life evidences have revealed the fact that numerous auditing firms are engaged in serving their clients with non-auditing services which consequently have an affect on the quality and the effectiveness of the process. The paper shall, thereby, be focussed on the study of the roles and responsibilities of the auditor in the present scenario. Additionally, the paper shall also tend to identify the impact of the non-auditing services rendered by auditors on the quality and effectiveness of the auditing services in the UK business environment. Roles and Responsibilities of Auditors From the legal point of view, any company with limited liability should compel the auditing process before the presentation of their annual accounts in order to confirm the erad ication of any misstatement in the financial statement of the company(s). Therefore, the roles and responsibilities of the auditor(s) are to examine the financial statements of the client’s company and ensure that the audited statements are mostly free from the mispresentation if not entirely. In other words, it is the responsibility of the auditor(s) to provide â€Å"reasonable assurance† to the conclusion that the financial statements presented by the company are at large free from any kind of material mispresentation occurring due to fraudulence or error. Apart from these responsibilities the auditors are also liable to communicate their viewpoints to the stakeholders which again call for an ethical behaviour from the end of the auditor (Green Paper, 2010). However, as revealed from various researches and studies, the focus of auditors, today, are inclined more towards the minimisation of risks occurring during the preparation of the financial statements. As quoted by the European Commission, the implication of auditing has been shifting from a verification based approach to a risk based approach raising certain major limitations on the part of the auditing process. For instance, the recent banking crisis was an example which apparently depicted the affect of this changing concept of auditing on the quality aspect and on the aspect of effectiveness as well (Green Paper, 2010). It is worth mentioning that the role practised by the auditors at present are inclined to be focussed majorly on the non-auditing services, (i.e. the eradication of risk of misstatement arising during the completion of the financial statements) rather than the auditing services which are centred on the evaluation of the financial statements presented by the company. The Impact of Non-Auditing Services Practised by Auditing Firms in the UK In the present day phenomenon, the practise of Non-Auditing Services by the auditors have gained a considerable amount of reaction fro m the global business environment, especially after the fall down of Enron. The reason of the dismissal according to a group of researchers is the impact of Non-Auditing Services on the aspect of auditor independence. On the contrary, a separate group of researchers state that the Non-Auditing Services in real life practises are beneficial for the auditors. According to the