Another reason for this belief is that some clients have immense power and influence in the business world. This is what occurred in the Russian hacking incident. Many powerful governmental agencies and the NASQEQ wanted to keep this incident as a secrete form the general public. Their argument was if this was to be known to the public, then the confidence in the exchange markets will decrease. Their argument has some validity, since if the investors begin to lose confidence in the market then the consequences would be devastating. But if the auditor still insisted on letting the public know what was going on, then the auditor should use the economic power bested upon them. An auditor can leverage this supposedly uneven relationship with an economic power that is only bestowed upon them. The power to write auditor’s opinion, qualified, and resignation is what helps an external auditor to perform their duties and to maintain certain leverage against a client. One can debate that resignations is not as effective as the other options stated
Another reason for this belief is that some clients have immense power and influence in the business world. This is what occurred in the Russian hacking incident. Many powerful governmental agencies and the NASQEQ wanted to keep this incident as a secrete form the general public. Their argument was if this was to be known to the public, then the confidence in the exchange markets will decrease. Their argument has some validity, since if the investors begin to lose confidence in the market then the consequences would be devastating. But if the auditor still insisted on letting the public know what was going on, then the auditor should use the economic power bested upon them. An auditor can leverage this supposedly uneven relationship with an economic power that is only bestowed upon them. The power to write auditor’s opinion, qualified, and resignation is what helps an external auditor to perform their duties and to maintain certain leverage against a client. One can debate that resignations is not as effective as the other options stated