From Deregulation to Reregulation in the Accounting and Auditing Professions
Author:
Univ. Prof. Florin GEORGESCU, Ph. D.
JEL:
M41, M42, M48
DOI:
Keywords:
audit, accounting profession, financial crisis, regulations
Abstract:
Recent history events, sometimes having undesirable and highly detrimental consequences, have shown that the accounting and auditing professions need to thoroughly upgrade their standards. Far from making the economic processes more efficient, the deregulation process that until recently was in full swing proved itself a source for global disequilibria - these have the potential to evolve into fully-fledged crises which are hard to contain and overcome in the short run. A reregulation process is currently underway; as the lessons of the global financial crisis are internalized, reregulation is achieved through the enactment of new regulations and the updating of the existing stock. The accounting and auditing professionals are the ones called to guarantee that the changes that have been operated or are ongoing (the standards of the two professions are, in essence, the result of a self-regulation process) be able to increase the transparency, the accuracy and the relevance of financial information – as a prerequisite for the efficient functioning of the markets and the economy as a whole. The two professional bodies should also ensure compliance with their specific regulations (in letter, but more importantly in spirit), in order to increase the quality of their work and ultimately the general public’s trust in financial information.\r\n