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Abstract: This paper presents the progress of auditor independence from a textbook perspective during the 20th century and into the present. It analyzes the multiple editions of Auditing Theory and Practice by Robert Montgomery. The lengthy time span of these editions is divided into several shorter periods based on major changes and developments in auditor independence. Finally, the paper uses several criteria related to auditor independence to review how the Montgomery text covered these changes and developments.
INTRODUCTION
A review of the literature shows that auditor independence is considered an abstract concept and a state of mind. It is defined as an auditor's unbiased viewpoint when preparing and issuing an audit report. It is synonymous with honesty, integrity, objectivity, courage, and character. Auditor independence is also viewed as "freedom from the control of those whose records are being reviewed" [Younkins, 1996, p. 322]. It means, in simplest terms, that auditors tell the truth as they see it and are not influenced by other factors, financial or otherwise, while rendering an unbiased opinion.
This paper focuses on the evolution of auditor independence from a textbook perspective. Auditing textbooks have been important in teaching independence, ethics, and professional values, among other topics, to accounting students before they join the workforce. The emphasis on independence in the textbook has changed over the course of the 20th century as authoritative professional pronouncements have provided new definitions and rules.
Robert Hiester Montgomery's auditing textbook was chosen for analysis because it is the oldest auditing textbook in the U.S. Montgomery's career in accounting began in 1889 when he worked as an office clerk for a public accounting firm where he was taught accounting and auditing. In 1898, Montgomery was a founding partner in Lybrand, Ross Bros & Montgomery (LRB&M), later Coopers & Lybrand and currently PricewaterhouseCoopers (PwC). Early in his career, he was associated with several accounting organizations - president of the New York State Society of CPAs in 1922, president of the American Association of Public Accountants (AAPA) from 1912 to 1914, and president of the American Institute of Accountants (AIA) from 1935 tol937.' Although Montgomery passed away in 1953, his textbook continued to be published throughout the remainder of the 20th century by his colleagues at LRB&M,...