IRCA INform

Threats to auditor

impartiality

Impartiality and balance as an auditor is essential to maintain. But are you prone to slips? Try our self-assessment to find out

The overall aim of third-party certification is to give confidence to all parties that rely on certification. The main principles for inspiring confidence are independence, impartiality and competence both in action and appearance.

Because threats may, or may reasonably be expected to, compromise an auditor’s ability to weigh up the situation fairly, it is essential to identify and analyze the effects of threats that are sources of potential bias.

Threats to auditor impartiality are sources of potential bias that may compromise, or may reasonably be expected to compromise, an auditor’s ability to make unbiased audit observations and conclusions.

Threats are posed by various types of activities, relationships and other circumstances. In order to understand the nature of those threats and their potential impact on auditor impartiality, the certification or registration body (CRB) should identify the types of threats posed by specific activities, relationships or other circumstances.

The following are examples of the types of threats that may create pressures and other factors that can lead to biased audit behaviour. Although the list is not mutually exclusive or exhaustive, it illustrates the wide variety of types of threat that CRBs need to consider when analyzing auditor independence and impartiality issues.

Do you fall prey to any of the following?

• self-interest threats — threats that arise from auditors acting in their own interest. Self-interests include auditors’ emotional, financial or other personal interests. Auditors may favour, consciously or subconsciously, those self-interests over their interest in performing a management system audit. For example, CRB relationships with clients create a financial self-interest because the clients pay the CRB's fees. Auditors also have a financial self-interest if they own shares in an auditee and may have an emotional or financial self-interest if an employment relationship exists between auditor’s family members and an auditee

• self-review threats — threats that arise from auditors reviewing the work done by themselves or by their colleagues. It may be more difficult to evaluate without bias the work of one’s own organization than the work of someone else or of some other organization. Therefore, a self-review threat may arise when auditors review judgments and decisions they, or others in their organization, have made

• familiarity (or trust) threats — threats that arise from auditors being influenced by a close relationship with an auditee. Such a threat is present if auditors are not sufficiently sceptical of an auditee’s assertions and, as a result, too readily accept an auditee’s viewpoint because of their familiarity with or trust in the auditee. For example, a familiarity threat may arise when an auditor has a particularly close or long-standing personal or professional relationship with an auditee

• intimidation threats — threats that arise from auditors being, or believing that they are being, openly or secretly coerced by auditees or by other interested parties. Such a threat may arise, for example, if an auditor or CRB is threatened with replacement over a disagreement with an auditee’s application of a specific requirement of the normative document being used as the reference for the audit

• advocacy threats — a body or its personnel acting in support of, or in opposition to, a given auditee, which is at the same time its customer, in the resolution of a dispute or litigation

• competition threats — between assessed auditee and a contracted technical assessor

If any of those circumstances sounds familiar, you may need to take a long hard look at yourself and ask, am I being as impartial as I should be?

The ISO 9001 Auditing Practices Group is an informal group of quality management system experts, auditors and practitioners drawn from the ISO Technical Committee 176 quality management and quality assurance (ISO/TC 176) and the International Accreditation Forum. It has developed a number of guidance papers and presentations that contain explanations about the auditing of quality management systems. These reflect the process-based approach that is essential for auditing the requirements of ISO 9001.

 

Have an issue to raise? A question to ask? Give us your opinions now in the Online Forums.