Understanding Auditor Independence
Independence in Fact and Appearance
Independence ensures that auditors make unbiased decisions and that users trust the audit opinion. Auditors must be independent both in fact (actual objectivity) and in appearance (how an informed third party views the relationship).
Note
Even if an auditor believes they are objective, independence may still be impaired if outsiders reasonably perceive a conflict.
Summary
Both actual and perceived independence are necessary to maintain confidence in the audit profession.