Ben E. Foster



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Mandatory Auditory Rotation (MAR) continues to be a highly contested issue within the financial community and since the Public Company Accounting Oversight Board's (PCAOB) recent concept release in August of 2011 on MAR there has been an increased level of interest in the issue. If the financial community and general public are to have an informed debate on such an important topic, then the interested parties need to have access to independent information on the matter in order to develop educated opinions on what is best for the markets. Unfortunately, the last true synthesis of such information came in 2004 when the Government Accountability Office (GAO) published a study on MAR as required by the Sarbanes-Oxley Act (SOX). This thesis is intended to be used by others to educate themselves with up-to-date knowledge of research available on MAR. This thesis will review issues such as the impact if any, of audit firm rotation on audit quality, the cost implications of MAR, the effect of MAR on market participant's perceptions of auditor independence, and the experiences of countries adopting mandatory audit firm rotation. I present the arguments and research, use the information to offer my own advice to policymakers and regulators on what will be best for the markets. The work creates a synthesis of the independent information available on MAR which will allow policymakers as well as the public to form a more educated opinion on what is the best path to take.

Publication Date


Project Designation

Honors Thesis

Primary Advisor

Robert K. Larson

Primary Advisor's Department



Stander Symposium poster

Mandatory Auditor Rotation: A Review and Analysis of Research from the last Decade