Judy Nagy – jnagy@deakin.edu.au
This
paper focuses on the continuing worldwide phenomenon of homogenisation of audit
rules, regulation and procedures between the public and private sectors. The
observations made are informed by Pusey’s (1991) and Quiggin’s (1996)
criticisms of ‘economic rationalism’ as the driving mechanism behind public
sector reforms in Australia. The presumed superiority of the commercial audit
practices as the reform agenda continues, is considered in association with the
work of Hopwood (1983, 1998), Otley and Pierce (1996) and, Power (1994, 1996,
1997) that contextualize the role of audit. Auditing is intended to safeguard
the interests of the public; be they the investing public, or, the citizens of
a nation. The need for economy and efficiency has changed the technicalities of
auditing with consequences for independence and audit quality. It is the
rhetorical nature of the espoused commitment to the public interest that
contributes to the private sector audit ‘expectations gap’. It is contended
that audit quality in the public sector is also becoming a victim of economic
rationalism with public sector having it’s own ‘expectations gap’ as the
practice of auditing becomes more generic.