The Impact of Ex-auditors’ Employment with Audit Clients on Perceptions of Auditor Independence

It is a common knowledge that auditors often being offered a position in their clients’ firms. However, following the collapse of Enron and other infamous financial scandals like Global Crossing and Waste Management in the US, the accounting profession was brought into sharp focus particularly regarding issues that may affect auditor independence. One of the issues is the practice of auditors seeking employment with their audit clients. Therefore, the main objective of this study is to examine whether the practice of ex-auditors’ employment with audit clients affects perceptions of auditor independence from the perspective of financial statement users in Malaysia.