Ethical Obligations and Decision-Making in Accounting: Text and Cases 4th Edition by Steven Mintz,Roselyn Morris

Exercise 5

Is independence impaired when an auditor is hired, paid, and fired by the same corporate managers whose activities are the subject of the audit? Does it matter that in most companies the audit committee hires, evaluate, fires (if appropriate), and determines the fees of the external auditor with minimal input from senior management?